deriving the fixed percentage?


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Hi again.!

P = (1 - n√r/c) x 100%

P = the depreciation percentage
n = the useful life of the asset (in this case 4 years).
r = the residual value of the asset.
c = the cost, or fair value of the asset.

what does it mean broken down? and what does this `√` symbol mean? THANKYOU!
 
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Triest123

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Hi again.!

P = (1 - n√r/c) x 100%

P = the depreciation percentage
n = the useful life of the asset (in this case 4 years).
r = the residual value of the asset.
c = the cost, or fair value of the asset.

what does it mean broken down? and what does this `√` symbol mean? THANKYOU!
`√` symbol mean 'the squrare root"

n√r/c = nth root of "r/c" ,

assumed r= 100 c =1000 n=4
r/c = 100 / 1000 = 0.1

n√r/c = 4√0.1 (i.e. the fourth root of 0.1)
= 0.5623

(In excel worksheet, you can enter 0.1^(1/4) to find the value)
 
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