The value of the motorcycle after 7 years will be $9937.17.
Depreciation is assigned so that a significant percentage of the depreciable amount is charged in each accounting cycle during the asset's expected useful life.
Depreciation would include amortisation of assets with a fixed useful life.
Now, according to the question;
The present value of the motorcycle is $10,000. (PV)
The future value of the motorcycle is to be estimated (FV).
The rate of depreciation is 9% per annum = 0.09.
Number of years = 7.
The formula for depreciation is;
FV= PV×{[1+(-i/100)]^n}
FV= 10,000×{[1+(-0.09/100)]^7}
FV= $9937.17
Therefore, the future value of the motorcycle after the depreciation of 9% for 7 years will be $9937.17.
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