Plant and equipment originally acquired at a cost of £80 000 had a written-down book value of £45 000 at the end of Year 2 using the reducing balance method.

The equipment was estimated to have no salvage value at the end ofits useful life.

Using the straight-line depreciation method, the written-down value at the end of Year 2 would have been:

(a) £64 000;

(b) £48000;

(c) £40000;

(d) £60000.

Problems