Home For AAT student members AQ 2016 Professional Diploma in Accounting Financial Statements for Limited Companies
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Depreciation totally throwing me on this task

You know when you look at something for so long, you just cannot think your way out of it...at this point i just feel silly for not knowing what to do.

Could anybody talk me through the calculations for the depreciation in this task please ready to be added to the COS/Admin/Distribution..

thank you


  • mergenmergen Just Joined Registered Posts: 111
    Im studying FSCL myself at the moment, on chapter 8.

    Land - Dr Land with 500k and Cr Revaluation Surplus 500k.

    Buildings is at 2% 125500x2%=2510 p.a.

    Plant and E is at 20% 40000x20%=8000 p.a. but its diminishing so you need to reduce it every year. e.g. 40k-8k=32k. 32000x20%=6400, 32000-6400=25600. 25600x20%=5120 and so on.
  • AnyPottsAnyPotts Registered Posts: 6
    it says land is not depreciated though....only buildings....would that change the answer?

    12,5500 - 50,500 = 75,000

    2% x 75,000 = 1'500
  • Pian32Pian32 Registered Posts: 247
    @Anypotts Correct
    You need to take the land out of the Land and Buildings amount on the trial balance and then depreciate. For the Plant and Machinery you need to take off the depreciation that has already occured and then depreciate.

    All figures (000)

    L+B -Straight line

    125,500-50,500= 75,000

    2%75000= 1,500

    P+M- Rolling Balance

    40,000 - 14,400 = 25,600

    20% * 25600 = 5,120
    AAT Level 4, MAAT
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  • AnyPottsAnyPotts Registered Posts: 6
    @pian32 perfect thank you - made the mistake of lookling at a fellow students answers and assumed, as only I could, that it must've been mine that was wrong.

    now to finish the task so my tutor doesnt think ive been lazy. haha
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