Anyone know how to work this out?
Abbie28
Feels At HomeRegistered Posts: 42
During the year some equipment was part exchanged.
The original equipment was brought for £1200.
Two years depreciation has been applied.
Depreciation is on reducing basis at 35%.
A part exchange allowance of £300 was given.
£1000 was paid from the bank for the new equipment.
Calculate the accumilated depreciatiopn on the old equipment that was part exchange during the year?
How do i work this out?
The original equipment was brought for £1200.
Two years depreciation has been applied.
Depreciation is on reducing basis at 35%.
A part exchange allowance of £300 was given.
£1000 was paid from the bank for the new equipment.
Calculate the accumilated depreciatiopn on the old equipment that was part exchange during the year?
How do i work this out?
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i dont know if the answer i 693 or 870?0

i got 693
You take 35% of £1200  which is £420
Then you take the £420 away from the £1200 which leaves  £780
Then 35% of 780 which is £273
Add the first year depreciation of £420 and the second years of £273 and you get  £693
Please correct me if i am wrong anyone.
Thanks0 
During the year some equipment was part exchanged.
The original equipment was brought for £1200.
Two years depreciation has been applied.
Depreciation is on reducing basis at 35%.
A part exchange allowance of £300 was given.
£1000 was paid from the bank for the new equipment.
Calculate the accumilated depreciatiopn on the old equipment that was part exchange during the year?
How do i work this out?
The px is a red herring and doesn't affect the depreciation. You need this info to do the disposals account (which I expect is the next step in this question).
Cost 1200
Depn year 1 = 1200 * 35% = 420
Depn year 2 1200420= 780.
780 *35% = 273
total depn for 2 years = 420+273 = 6930 
The question has asked for the accumulated depreciation so:
Original Cost of Equipment 1200
Yr 1 Depreciation (35%) (420)
NBV at end Yr 1 780
Yr 2 Depreciation (35% of 780) (273)
NBV at end Yr 2 507
Therefore the accumulated depreciation is the charge in Yr 1 (420) plus the charge in Yr 2 (273) making a total of 693.
Hope that makes sense!
Edit: Whoops  looks like we all answered at once!0 
Thank you!!! really helpfull!0

Do you know where i could get tips on Appropriation Accounts i suck at them big time...
I reallyappreciated that thank for your time im so happy now i finally understand it.0