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A computer is depreciated using a flat rate depreciation method. It was purchased for $2800 and depreciates at the rate of 8% per annum. The amount of depreciation after 4 years is

Question

A computer is depreciated using a flat rate depreciation method. It was purchased for $2800 and depreciates at the rate of 8% per annum. The amount of depreciation after 4 years is

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Solution

To calculate the depreciation of the computer after 4 years using the flat rate depreciation method, follow these steps:

  1. Identify the initial cost of the computer, which is $2800.

  2. Identify the annual depreciation rate, which is 8% or 0.08 in decimal form.

  3. Calculate the annual depreciation amount by multiplying the initial cost by the depreciation rate. 28000.08=2800 * 0.08 = 224

  4. Calculate the total depreciation after 4 years by multiplying the annual depreciation amount by the number of years. 2244=224 * 4 = 896

So, the amount of depreciation after 4 years is $896.

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