- This topic has 0 replies, 1 voice, and was last updated 6 years ago by
.
- Posts
BPP Revision Kit-29 Minco (d?
The property was purchase at $5m with annual depreciation of $500k in 1Jun 20×1
On 1 Oct 20×3 the property was treated as NCAHFS. Accumulated depreciation is $1m and impairment loss is $350k on 31May 20×3.
From 1Jun20x3 to 30Sep20x3(4 months) the property is still under IAS16 where depreciation is still required to be accounted.
My assumption is that as the question indicates that the annual depreciation is $500k, based on this figure the four month depreciation should be $500k X4/12. However the answer demonstrate a different way to calculate the depreciation as
[($5m-$1m-$350k)/8 years] x 4/12.Why the answer calculate the depreciation like that and what wrong with my assumption (what I miss in consideration) ?
- You must be logged in to reply to this topic.