Financial Accounting Zubaidah Abdul Rehman

Home Work 3 20042080

HW Question
Swanton Coman! urcha"ed a new machine at a co"t o# $%20000& 'he e"timated "al(age (alue i"
$%2000& 'he machine i" e)ected to be u"ed #or %0000 working hour" during it" #i(e !ear"& Comute
and record the dereciation u"ing "traight line* unit o# acti(it! and declining+balance method"&
HW Answer
Section %, Straight+-ine .ethod
/ereciation 0 %20000+%2000 0 2%100
2
3ear 4ntr! Recording /r& Cr&
3ear % /ereciation 4)en"e 2%100
Accumulated /ereciation 2%100
3ear 2 /ereciation 4)en"e 2%100
Accumulated /ereciation 2%100
3ear 3 /ereciation 4)en"e 2%100
Accumulated /ereciation 2%100
3ear 4 /ereciation 4)en"e 2%100
Accumulated /ereciation 2%100
3ear 2 /ereciation 4)en"e 2%100
Accumulated /ereciation 2%100
Section 2, 5nit"+o#+Acti(it! .ethod
A""uming that e)ected hour" were6 3ear % 2000* 3ear 2 3000* 3ear 3 4000* 3ear 4 2000* and 3ear 2
10007 we calculate it below6
/ereciation 0 %20000+%2000 0 %0&8
%0000
3ear 4ntr! Recording8Comutation /r& Cr&
3ear % Comutation 0 %0&8 ) 2000 0 2%100
/ereciation 4)en"e 2%100
Accumulated /ereciation 2%100
3ear 2 Comutation 0 %0&8 ) 3000 0 32400
9age % o# 2
Financial Accounting Zubaidah Abdul Rehman
Home Work 3 20042080
/ereciation 4)en"e 32400
Accumulated /ereciation 32400
3ear 3 Comutation 0 %0&8 ) 4000 0 43200
/ereciation 4)en"e 43200
Accumulated /ereciation 43200
3ear 4 Comutation 0 %0&8 ) 2000 0 24000
/ereciation 4)en"e 24000
Accumulated /ereciation 24000
3ear 2 Comutation 0 %0&8 ) 1000 0 14800
/ereciation 4)en"e 14800
Accumulated /ereciation 14800
Section 3, /eclining+:alance .ethod
/eclining+:alance Rate 0 % ; %00< 20
2
/ouble+/eclining :alance 0 20 ) 2 0 40<
3ear
:ook =alue
:eginning o#
the 3ear
/ereciation Rate
Annual
/ereciation
4)en"e
Accumulated
/ereciation
:ook
=alue
4nd o# the
3ear
% %20000 40< 48000 48000 >2000
2 >2000 40< 28800 >1800 43200
3 43200 40< %>280 ?4080 22?20
4 22?20 40< %0318 %04448 %2222
2 %2222 40< @3222 %08000 %2000
@Comutation o# 1220&8 A%2222 ) 40<, i" adBu"ted to 3222 in order #or book (alue to eCual "al(age
(alue&
9age 2 o# 2