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March 18, 2020 at 3:27 pm
Hello Chris. In the first example, the question says capital allowances are available at 25pcnt reducing balance. Why did you still use straight line method to depreciate the asset. Please i need a reply.
May 14, 2020 at 11:59 pm
It’s reducing balance
July 14, 2020 at 3:22 pm
Reducing balance is specified for Capital allowance (= for Taxation base). Accounting depreciation type is not specified here but by default it’s meant to be straight-line basis I believe.
So for Carrying value (for accounting) we use straight-line method, and for Tax base (for Taxation purposes) we use reducing balance method at 25%
July 14, 2020 at 3:24 pm
And even thought straight-line method for CV is not said specifically, you can guess that it should be so from given information. They give us residual value and estimated life. You can only calculate depreciation with straight-line method using this info
March 5, 2019 at 4:54 pm
Really good lecture, detailed content is very helpful
October 13, 2019 at 10:11 am
Can’t agree more!
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