Reversing depreciation/amortization


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Hi all,

I have a building worth 441,000 today which is owned for 11 months and been depreciated at 6% using declining balance method prorated monthly. I need to find out what the original value was 11 months ago or alternatively what the current accumulated depreciation is.

I know that if I was to depreciate the building for another 11 months from its currently know $441,000 value the formula would be:

441,000 * 6% * 11/12 = 24,255

441,000 - 24,255 = 416,745 for its current carrying cost.

Basically what i'm looking to do is reverse the formula to find the original cost. I have found what that original cost is (466,667) by using the trial and error method but there has to be an easier way. There's no way I can blow 20 minutes using trial and error in an exam and am hoping to find a neatly package formula instead.

Any help would be greatly appreciated.
 
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kirby

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Another case where you have to apply 5th grade algebra.
The 441,000 plus (the original cost (x) times 6% times 11 over 12 ) is your original cost
So 441,000 + (X times .06 times 11/12) equals x
Hopefully you should be able to handle from there
Hopefully.......
 
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