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Compute first-year straight-line depreciation with a salvage value

  • For Accountants
  • You practice Catching mistakes and made-up facts
  • Time about 5 minutes
  • Level Intermediate

About this exercise

You're setting up depreciation for a newly purchased machine. Write a prompt for plain text with lines starting "Depreciable base:", "Monthly:", "Accumulated at Dec 31:" and "Net book value:", each with the math. Policy: straight-line, depreciation starts the month after the in-service date. For accumulated depreciation, use months/total months x depreciable base to avoid rounding drift. Under 70 words. No bullets or numbering.

Common mistakes when you ask AI for this

  • Starting in September. The AI counts four months and shows $1,666.67. Try: Say: "Depreciation starts the month after the in-service date: Oct, Nov, Dec."
  • Ignoring salvage. The AI depreciates the full $24,000 over 48 months. Try: Add: "Depreciable base = cost minus salvage."
  • Net book value from the base. The AI subtracts accumulated depreciation from $20,000. Try: Add: "Net book value = cost minus accumulated depreciation."
  • Markdown extras. The AI adds bold labels, headings and a closing note. Try: Say: "Plain text, no bold. Output only the lines asked for."
  • Trusting the AI to count words. AI is bad at counting and runs past word limits. Try: Ask for fewer words than the real cap and keep each line short.

What a strong prompt includes

  • Names the four lines
  • Subtracts salvage
  • Gives the start rule
  • Gives the accumulated formula
  • Caps length

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