Bpp Depreciation

Alaa

How did they get the 8000 ?

NeilH

Hi

The asset will have a residual value of £4,000, so you need to depreciate £16,000 over four years = £4,000 depreciation per year.

At the end of the third year (30 June 20X3) you will therefore have depreciated £12,000 of the £20,000 asset leaving a balance sheet value of £8,000.

Alaa

Thank you so much for the explanation