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Hi may i know with reference to the question on bpp textbook.
Why is the depreciation during the year for building the value is taken as cost /UL instead of the NBV value but for the P&M dprctn for the year is calculated after the deduction of aclmtd dprctn and disposal.
Hi,
i’d presume as the building is depreciated on a straight line basis and the plant and machinery on a reducing balance basis.
Thanks
But on TB L&B has an accumulated depreciation of 120. Suppose to ignore?
Hi,
Yes, if we are depreciating the asset based upon straight line depreciation then the depreciation is based upon the depreciable amount (cost less residual value), and so the accumulated depreciation balance does not appear in the calculations.
Thanks
Thanks!