SUM YEAR’S DIGIT

OF THE
METHOD

FABRIKAM
 5. An industry plant bought a generator set
for
P 90,000. Other expenses including installation
amounted to
P 10,000. The generator set is to have a life of 17
years with a salvage value at the end of life of
P 5,000. Determine the depreciation charge during
the 13th year and the book value at the end of 13
years by the:

(d.) SYD Method 2

FABRIKAM
 Year in
Depreciation during the Book Value at the
Year Reverse
Year End of the Year
Order
1 17 17/153 (95000) = 10, 555.56 89, 444.44

2 16 16/153 (95000) = 9,934.64 79, 509.80

3 15 15/153 (95000) = 9,313.73 70, 196.07

4 14 14/153 (95000) = 8,692.81 61, 503.26

5 13 13/153 (95000) = 8071.90 53, 431.36

6 12 12/153 (95000) = 7450.98 45, 980.38

7 11 11/153 (95000) = 6830.07 39, 150.31

3
8 10 10/153 (95000) = 6209.15 32, 941.16
FABRIKAM
 Year in
Book Value at the End
Year Reverse Depreciation during the Year
of the Year
Order

9 9 9/153 (95000) = 5, 588.24 27, 352.92

10 8 8/153 (95000) = 4, 967.32 22, 385.6

11 7 7/153 (95000) = 4, 346.41 18, 039.19

12 6 6/153 (95000) = 3, 725.49 14, 313.7

13 5 5/153 (95000) = 3, 104.58 11, 209.12

14 4 4/153 (95000) = 2, 483.66 8, 725.46

15 3 3/153 (95000) = 1, 862.75 6, 862.71

16 2 2/153 (95000) = 1, 241.83 5, 620.88

17 1 1/153 (95000) = 620.92 5,000

SUM = 153
FABRIKAM
 Using the Formula:
𝐿
• SUM = (1 + L)
2

𝐿−𝑛+1
• dn = (FC – SV)( )
𝑆𝑈𝑀

𝑛(2𝐿−𝑛+1)
• Dn = (FC – SV) ( )
2(𝑆𝑈𝑀)

• BVn = FC - Dn

FABRIKAM
SOLUTION:
𝐿
SUM = (1 + L)
2
17
= (1+17)
2
SUM = 153

𝐿 −𝑛+1
𝑑 13 = (FC – SV) ( )
𝑆𝑈𝑀
17−13+1
= (100, 000 – 5, 000) ( )
153
𝑑 13 = 3, 104.58
`
6

FABRIKAM
 𝑛(2𝐿−𝑛+1)
D13 = (FC – SV) ( )
2(𝑆𝑈𝑀)

13(2 ∗17−13+1)
= (100, 000 – 5, 000) ( )
2(153)

D13 = P 88, 790.85

BV 13 = FC - D13
= 100, 000 – 88, 790.85
BV 13 = P 11, 209.15

FABRIKAM
FABRIKAM