• Skip to primary navigation
  • Skip to main content
  • Skip to primary sidebar
Free ACCA & CIMA online courses from OpenTuition

Free ACCA & CIMA online courses from OpenTuition

Free Notes, Lectures, Tests and Forums for ACCA and CIMA exams

  • ACCA
  • CIMA
  • FIA
  • OBU
  • Books
  • Forums
  • Ask AI
  • Search
  • Register
  • Login
  • ACCA Forums
  • Ask ACCA Tutor
  • CIMA Forums
  • Ask CIMA Tutor
  • FIA
  • OBU
  • Buy/Sell Books
  • All Forums
  • Latest Topics

20% off ACCA & CIMA Books

OpenTuition recommends the new interactive BPP books for September 2025 exams.
Get your discount code >>

how to caculate accumulated depreciation question–bpp revision kit, page 9. Riffon question.

Forums › ACCA Forums › ACCA FA Financial Accounting Forums › how to caculate accumulated depreciation question–bpp revision kit, page 9. Riffon question.

  • This topic has 1 reply, 2 voices, and was last updated 14 years ago by Anonymous.
Viewing 2 posts - 1 through 2 (of 2 total)
  • Author
    Posts
  • August 12, 2010 at 1:22 pm #44933
    msmbjl
    Member
    • Topics: 1
    • Replies: 0
    • ☆

    anyone working on F3 Uk version, I have a problem with accumulated depreciation caculation. bpp practice & revision kit page 9, No.6 preparation question: Riffon, how can one caculate the plant & machinery this year’s depreciation by 800,000×25%? for P&L account, I thought it should be: cost of plant & machinery by the end of year is 800,000 ; disposal item accumulated depreciation is 180,000; total accumulated depreciation for plant & machinery is 306,000, therefore the net book value for P&M current year before depreciation is 800,000-(306,000-180,000)=674,000; straight line rate 25%, so current year deprecation charged into P&L account should be 674,000×25%=168,500, but the answer is 800,000×25%=200,000.

    August 23, 2010 at 7:27 pm #65513
    Anonymous
    Inactive
    • Topics: 0
    • Replies: 1
    • ☆

    Well, I’m afraid you’re just not understanding what is P&M account @ cost and what is Accumulated depreciation. It simply need revising – do it with your course notes.

    800,000 is balance c/d for P&M, it means that you shouldn’t deduct any 306,000 and 180,000 from this amount.

    306,000 = this is accumulated depreciated brought down from the previous year, so it should be in your account of Accumulated depr-n. That’s why the name of account is ACCUMULATED, so every year you add your annual depreciation charge to previous year amount. So 306,000 should’t be deducted.

    180,000 = this was accumulated depreciation for plant, which was sold. If you sell a plant or anything, you credit Plant account by cost of that plant, and also debit Accumulated depreciation by that amount, which was ACCUMULATED during all the years. So you simply remove it. And again there is nothing to do with this amount regarding those 800,000 of balance b/d.

    Maybe it’s not a really good explanation, I’m not native speaker 🙂

    But in steps: 1) Opening balance of accum. depr-n = 306,000 – credit side
    2) Sold plant => (180,000) => debit side
    3) All above was in the past. You are know to calculate depreciation charge for this year. So you take 800,000 because it’s closing balance of P&M account, count 25% and add it to the credit side fo Accum. depr-n account.
    4) You calculate balance c/d, which is 326,000…

    Hopefully, it was understandable 😀
    Actually, I understood it after long staring at answer and trying to explain myself what’s going on and why 🙂

  • Author
    Posts
Viewing 2 posts - 1 through 2 (of 2 total)
  • You must be logged in to reply to this topic.
Log In

Primary Sidebar

Donate
If you have benefited from our materials, please donate

ACCA News:

ACCA My Exam Performance for non-variant

Applied Skills exams is available NOW

ACCA Options:  “Read the Mind of the Marker” articles

Subscribe to ACCA’s Student Accountant Direct

ACCA CBE 2025 Exams

How was your exam, and what was the exam result?

BT CBE exam was.. | MA CBE exam was..
FA CBE exam was.. | LW CBE exam was..

Donate

If you have benefited from OpenTuition please donate.

PQ Magazine

Latest Comments

  • Hsaini on Accounting for Management – ACCA Management Accounting (MA)
  • kennedyavege@2023 on Relevant Cash Flows for DCF Relevant Costs (example 1) – ACCA Financial Management (FM)
  • John Moffat on Relevant Cash Flows for DCF Relevant Costs (example 1) – ACCA Financial Management (FM)
  • mrjonbain on Presentation of Financial Statements (IAS 1) – ACCA Strategic Business Reporting (SBR) lectures
  • Aidos on Presentation of Financial Statements (IAS 1) – ACCA Strategic Business Reporting (SBR) lectures

Copyright © 2025 · Support · Contact · Advertising · OpenLicense · About · Sitemap · Comments · Log in