A new machine has been bought for 5,000. It is expected to last for five years, and

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A new machine has been bought for £5,000. It is expected to last for five years, and have a residual value of £500.

(a) Calculate the charge against profits and balance sheet value for each of the five years, using

(i) straight line method;

(ii) reducing balance method; and

(iii) sum of the digits method.

(b) Explain carefully the effect of the different methods.

(c) Which method do you consider most appropriate, and why?

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Accounting In Business

ISBN: 9780408014861

5th Edition

Authors: R. J. Bull

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Question Posted: Jun 04, 2024 02:09 AM

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A new machine has been bought for 5,000. It is expected to last for five years, and

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Accounting In Business

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