BPP Unit 5 - Full Skills Test 2 - Can you help?

System
System Posts: 100,534 🤖 Admin 🤖
edited June 18 in AAT student discussion
Hi

BBP Unit 5 Assessment Kit - Full Skills Test 2

Task 1 and 2

The damaged warehouse fittings are worth £3500. you need to work out the depreciation on these fittings.
(Depreciation is 20% reducing balance)

I make is £700. ie 3500 - (3500 x 0.8 ).

The Answer in the back is 3500 - (3500 x 0.8 x 0.8 ) = 1260.


Can anyone explain to me why you need to x 0.8 twice.

Thanks

Karen

Comments

  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:BPP Unit 5 - Full Skills Test 2 - Can you help?

    How long have you had the fixed asset? and when in the year are you selling as a full year of depn may not be required, maybe you have only held it for 6months of that year?
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:BPP Unit 5 - Full Skills Test 2 - Can you help?

    Hi

    I have just realised what I did wrong. You needed depreciate the £3500 (which was the original cost) for 2 years.

    Thanks for you help

    Karen
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:BPP Unit 5 - Full Skills Test 2 - Can you help?

    NO probs

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