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Depreciation topic

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  • January 1, 2020 at 1:34 pm
    Depreciation topic 2
    vishnutv
    Participant

    If we purchased a car $20000 with expected life 5years with depreciation 4000 per year and after 5 years residual value will be zero !
    So after that is the car should be disposed ? Or ?

    January 1, 2020 at 1:38 pm
    Depreciation topic 2
    vishnutv
    Participant

    If car should be sold at which value car should be sold?

    January 2, 2020 at 6:48 am
    Depreciation topic 4
    John Moffat
    Keymaster

    The estimated life is only an estimate. If we still have the car after 5 years then we simply do not depreciate it any more.

    As and when we decide to sell it, we sell it for as much as we can!! There will then be a profit on sale in the normal way.

    Have you watched my free lectures on this? The lectures are a complete free course for Paper FA and cover everything needed to be able to pass the exam well.

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