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exampl 3 chapiter 9 replacement

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA FM Exams › exampl 3 chapiter 9 replacement

  • This topic has 1 reply, 2 voices, and was last updated 9 years ago by John Moffat.
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  • February 18, 2016 at 9:43 pm #301091
    josy87
    Member
    • Topics: 173
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    • ☆☆☆

    Sir why the capital allowance is calculated at year 0 instead of 1 ?

    February 19, 2016 at 7:01 am #301111
    John Moffat
    Keymaster
    • Topics: 57
    • Replies: 54727
    • ☆☆☆☆☆

    There is no such thing as year 0.

    0 is a point in time, time 1 is one year later, and so on.

    In this example the machine is bought on the last day of the financial year (and this is time 0). Capital allowances are calculated at the end of the financial year and so they will start at time 0 as well.

    I do explain this in the lecture working through this example.

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