- This topic has 3 replies, 2 voices, and was last updated 11 years ago by
.
- Posts
Tucker co had motar vehicles with carying amount at 1jan 02 of $270000. on that date it traded in a car which had cost of $35000 on 1 janx0 for a new car which cost $46000 handling over a cheque over a full settlement for $23000.tucker company depreciates motor vehicle at 20% per annum on reducing balance basis.
how much depreciation will be charged in tuckers co in come statement for the year end 31 dec x2 in respect of motor vechicels
a $58720
b $70200
c $59000
d $63200
plz explain me in detail i will be very thankful to uSince the are using reducing balance, you need to know the carrying value/net book value (NBV) at the start of the year.
It was 270,000 but you need to add on the cost of the new car (46,000) and subtract the net book value of the car that was sold.
The car that was sold was bought for 35,000 but will have been depreciated (reducing balance) for 2 year (X0 and X1).Calculate the NBV of the car sold.
The take the opening balance + cost of new car – NBV of car sold.Then calculate 20% of this figure.
- You must be logged in to reply to this topic.