Graham Dyson purchased machinery for £3,000 in April 20-4. It is expected to have an effective working life of five years and its estimated disposal value at the end of this period is £712.

You are required to show the machinery and the provision for depreciation accounts for the five years. Depreciation is to be calculated at a rate of 25 per cent per annum on the reducing balance method. Accounts are prepared annually to 31 December and a full year’s depreciation is provided in the year of purchase.