June 2006 wear wraith

I'm not sure which revision kit you are using but abyhow, the mpoint about the motor vehicles is as follows: We are told they are depreciated at 33% so the assumption is a 3 year useful life. However: 1 We are also told that the motor vehicles are sold after 5 years. Therefore there is an inconsistency. If the vehicles last for 5 years the depreciation rate should be 20% pa. 2 There might also be a problem with the depreciation charge. The cost at 31/5/20X6 is 1,700,000 and the depreciation charge for the year is 425,000 ie 25%. Of course the charge shold be lower than 33% because some of the vehicles will probably be fully depreciated if they are usually kept for 5 years. However 25% is a very round nnumber and they might simply have applied 25% to the closing cost balance. It certainly needs investigation. So: Company says depreciation rate is 33% Looks as though 25% has been applied Looks as though 2-% would be more appropriate.