Hewlett co Revaluation PPE

This topic has 4 replies, 2 voices, and was last updated 7 years ago by aarina.

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July 5, 2018 at 4:45 am #460997

aarina
Member

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.

July 6, 2018 at 3:51 pm #461139

P2-D2
Keymaster

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

July 7, 2018 at 3:59 am #461182

aarina
Member

But on TB L&B has an accumulated depreciation of 120. Suppose to ignore?

July 8, 2018 at 7:48 pm #461332

P2-D2
Keymaster

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

July 12, 2018 at 2:00 pm #461841

aarina
Member

Thanks!
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