Asked by Brianna Elizabeth on Jul 21, 2024
Verified
Larry's car is worth $18,000 after 5 years.When the car was new,it sold for $24,000.What is the depreciation rate?
A) 0.5%
B) 0.6%
C) 5.6%
D) 6.9%
Depreciation Rate
The rate at which an asset loses its value over time, calculated for accounting and tax purposes.
- Analyze the role of depreciation in the diminishing value of a vehicle over the years.
Verified Answer
ZH
Zicheng HuangJul 21, 2024
Final Answer :
C
Explanation :
To find the depreciation rate, we need to determine how much value the car lost over 5 years. We can do this by subtracting the current value from the original value:
$24,000 - $18,000 = $6,000
The depreciation rate is the percentage of the original value that was lost, which we can calculate by dividing the lost value by the original value and multiplying by 100:
($6,000/$24,000) x 100 = 25%
Therefore, the depreciation rate is 25%.
Out of the answer choices provided, C is the closest to 25%, with a value of 5.6%. The other choices are too low or too high, and do not accurately reflect the depreciation rate.
$24,000 - $18,000 = $6,000
The depreciation rate is the percentage of the original value that was lost, which we can calculate by dividing the lost value by the original value and multiplying by 100:
($6,000/$24,000) x 100 = 25%
Therefore, the depreciation rate is 25%.
Out of the answer choices provided, C is the closest to 25%, with a value of 5.6%. The other choices are too low or too high, and do not accurately reflect the depreciation rate.
Learning Objectives
- Analyze the role of depreciation in the diminishing value of a vehicle over the years.