# Solution: Find the annual rate of depreciation of the machine in percentage

A machine costing P45,000 is estimated to have a book value of P4,350 when retired at the end of 6 years. Depreciation cost is computed using a constant percentage of the declining book value. What is the annual rate of depreciation in %?

#### Problem Statement: CE Board May 1996

A machine costing P45,000 is estimated to have a book value of P4,350 when retired at the end of 6 years. Depreciation cost is computed using a constant percentage of the declining book value. What is the annual rate of depreciation in %?

• A. 32.50%
• B. 32.25%
• C. 32.00%
• D. 32.75%

#### Problem Answer:

The annual rate of depreciation of the machine is 32.25%.

Solution:

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