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Answer :
Final answer:
The student's question revolves around financial decisions in a business context, focusing on renting a vehicle and related expenses.
Explanation:
Business practices often involve financial decisions, such as purchasing vehicles, managing loans, and making strategic investments. In this scenario, the student is exploring financial aspects related to renting a vehicle and managing associated expenses.
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Rewritten by : Barada
The vehicle depreciates by $2,000 each month, which is approximately 33.33% of the total rental cost.
The customer rents a vehicle for three months from November 1, paying a total of $6,000, which breaks down to $2,000 per month.
To calculate the depreciation of the vehicle per month, we can use the straight-line depreciation method. This method divides the cost of the asset by its useful life to determine the monthly depreciation expense.
Given that the rental period is three months and the total cost is $6,000, the monthly depreciation can be calculated as follows:
[tex]\[ \text{Monthly Depreciation} = \frac{\text{Total Rental Cost}}{\text{Number of Months Rented}} \] \[ \text{Monthly Depreciation} = \frac{6000}{3} \] \[ \text{Monthly Depreciation} = 2000 \][/tex]
Therefore, the vehicle depreciates by $2,000 each month during the rental period.
If we want to express the depreciation as a percentage of the total cost, we can calculate it as follows:
[tex]\[ \text{Depreciation Percentage} = \left( \frac{\text{Monthly Depreciation}}{\text{Total Rental Cost}} \right) \times 100 \] \[ \text{Depreciation Percentage} = \left( \frac{2000}{6000} \right) \times 100 \] \[ \text{Depreciation Percentage} = \left( \frac{1}{3} \right) \times 100 \] \[ \text{Depreciation Percentage} = 33.33\% \][/tex]
So, the vehicle depreciates by approximately 33.33% each month during the rental period when expressed as a percentage of the total cost.
The complete question is- Suppose a customer rents a vehicle for three months from commodores rental on november 1, paying $6,000 ($2,000/month). Then calculate the depreciation of the vehicle per month.
