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MC Question 13 – June 2015
The following trial balance extract relates to a property which is owned by Veeton as at 1 April 2014:Dr Cr
$’000 $’000
Property at cost (20 year original life) 12,000
Accumulated depreciation as at 1 April 2014 3,600
On 1 October 2014, following a sustained increase in property prices, Veeton revalued its property to $10·8 million.What will be the depreciation charge in Veeton’s statement of profit or loss for the year ended 31 March 2015?
A $540,000
B $570,000
C $700,000
D $800,000
I dont understand how they got a useful life for the revalued amountCorrect. The annual depreciation was 12,000 over 20 year, and if a total of 3,600 has been charged then six years must have elapsed and there are 14 years left.
Thanks
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