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Hi John
I am confused on a certain part of question 19.5 . Why do we calculate the purchase of non-current asset at Cost ? For 19.6 the purchase of cost is calculated using the net book value ?
I hope you can help
Arahn
We always need the cost paid for any non-current assets acquired.
In 19.5 we are given the details of both the cost and the accumulated depreciation so we can find the cost just by looking at the cost balances.
In 19.6 we are only given the net book values and so we have to sort out those balances (similar to the way I do in my lecture examples).
and sir I wanna ask something when we decrease the depreciation amount from the asset. like in lectures you have told us not to include current depreciation because it will be charged to depreciation expense to accumulated depreciation ac. but in 19.6 is been charged in the asset account only
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