Mini Exercises

Deduct from carrying value to determine how much of the carrying value needs to be depreciated over the revised estimated useful life At date of transfer it had a carrying value of $60,000 Sold for $65,000 Scrap value now $20,000 So $45,000 to depreciate Estimated useful life 5 years So depreciation now $9,000 per annum That compares with $10,000 per annul before the transfer. Pup to be eliminated: $5,000 on the transfer less $1,000 depreciation If it hadn't been transferred, carrying value would have been $52,000 (60 - depreciation on 60 - 20) After transfer carrying value is $56,000 (65 - depreciation on 65 -20) Ok?

so, scrap value should be deducted from both 60 and 65. and when I do the CSofFP, I can just calculate pup in this way: 5,000/5 (1,000) _______ 4,000 right? 'cuz it's what you are suggesting in the lecture.:) Sir, Can I really really write down the same abbreviations as in your lecture?like ret ears/pup/rev/pat..etc, because I am only using opentuition.com and BPP revision kit to help with my exam, I need to be 100% sure:) Thank you!!!

100% certain - abbreviate in the numbers answers (but, if you have to write to someone like in a report or a letter, don't abbreviate there) Yes, we need to deduct the scrap estimate from both the 60 and the 65

thank you! sir

You're welcome

sir, can I write this down in my answer paper? PUP: 5,000/5 (1,000) _______ 4,000 or I need to calculate it in details?

What you've written is fine. Maybe safer to write: Profit 5,000 Depn (1,000) Pup 4,000