Depreciation Question agian

System
System Posts: 100,534 🤖 Admin 🤖
edited 10:31AM in AAT student discussion
hello all,
i'm trying 2 do Specimen Exam paper 2003 Standard of Unit 5 FRA. Stuck on a question of Depreciation.
Give u the information, I'll really appreciate if some 1 can help plzzzzzzzzz.

Calculate the Depreciation for year ending 31 Dec 2002. (25% reducing balace method)
Total Vehicle cost (31 dec 2001): 23025
Accumulated Dep: 12750
net book value: 10275

Some of vehicle originally cost £8000 in 1999 part exchanged (i think £8000 is included in the above info)
prov of dep on this £8000 (for 3 yrs, should be included in the above info as well): 4625
Part exchanged allownce: 2000
paid for replacement (bank): 7500

NOTE: when part exchanged it also said that no dep in the yr of disposal. so no dep has been done in 2002 yet on any vehicle amount.

Got flu as well (not feelin well )
Thnx in advance if some 1 can help.

Comments

  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:Depreciation Question agian

    i did it like this:
    vehicles:
    23025
    less: disposed vehicle:
    (8000)

    15025
    less: Accumulated Dep:
    (12750)
    2275
    Add: New vehicle:
    9500

    11775

    now depreciation for 2002 will be:
    11775*25%=2943.75

    Is it right?

  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:Depreciation Question agian

    £7,500(bank)+ £2,000 (part exchange allowance)=£9,500
    vehicles at cost (23,025-8,000+9,500)=24,525
    Accumulated depreciation (12,750-4,625)=£8,125
    Depreciation for the year ((24,525-8,125)x25%)=4,100
    Updated accumulated depreciation (8,125+4,100)=£12,225
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:Depreciation Question agian

    £7,500(bank)+ £2,000 (part exchange allowance)=£9,500
    vehicles at cost (23,025-8,000+9,500)=24,525
    Accumulated depreciation (12,750-4,625)=£8,125
    Depreciation for the year ((24,525-8,125)x25%)=4,100
    Updated accumulated depreciation (8,125+4,100)=£12,225

    Is this right?
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:Depreciation Question agian

    Thnx Shiwani,
    It is absolutely right. i just saw ur message and i tried 2 do it like this as well. My tutor sent me an email for the answer of this paper and yes it was right.
    thanks again,
    I really apreciate it.
    Bye
    Naureen
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