Vuhelper
06-07-2011, 11:18 PM
Semester “Spring 2011”
“Financial Accounting (MGT101)”
This is to inform that Graded Discussion Board (GDB)
Discussion Question
On 1st January 20X3, a company purchased a machinery having list price of Rs. 500,000 with the condition of making full payment within 15 days from the date of purchase to avail discount equal to 2% of the list price.
The company incurred transportation expenses Rs. 20,000 and insurance-in-transit Rs. 5,000. The company availed the discount & installed the machinery at the cost of Rs. 35,000.
The estimated useful economic life of the asset is 10 years with the residual value of Rs. 50,000.
Calculate:
(1) The cost of the asset to be capitalized for balance sheet purpose;
(2) The annual depreciation expense for year 20X3under straight line depreciation; &
(3) The annual depreciation expense for year 20X4under declining balance method.
“Financial Accounting (MGT101)”
This is to inform that Graded Discussion Board (GDB)
Discussion Question
On 1st January 20X3, a company purchased a machinery having list price of Rs. 500,000 with the condition of making full payment within 15 days from the date of purchase to avail discount equal to 2% of the list price.
The company incurred transportation expenses Rs. 20,000 and insurance-in-transit Rs. 5,000. The company availed the discount & installed the machinery at the cost of Rs. 35,000.
The estimated useful economic life of the asset is 10 years with the residual value of Rs. 50,000.
Calculate:
(1) The cost of the asset to be capitalized for balance sheet purpose;
(2) The annual depreciation expense for year 20X3under straight line depreciation; &
(3) The annual depreciation expense for year 20X4under declining balance method.