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2. You have started your company named Geboo Bakery, for a year and as the business is doing well, you have decided to expand the
2. You have started your company named Geboo Bakery, for a year and as the business is doing well, you have decided to expand the business by purchasing more tangible assets in order to meet the increasing demands of cakes and breads. Your clerk, Sarah, is indecisive to determine the appropriate depreciation methods for the three newly purchased tangible assets which are industrial oven, van and chiller as shown in TABLE Q2. As a graduate in Business Management from Universiti Teknologi PETRONAS, help Sarah by proposing the best depreciation method for each of the assets. Show all computations with reasons for each possible method. TABLE Q2: Information on tangible assets Asset Item Cost Estimated Useful Life Industrial oven RM10,500 5 Van RM65,000 6 Chiller RM13,000 7 Scrap Value RM2,500 RM10,000 RM1,500 2. You have started your company named Geboo Bakery, for a year and as the business is doing well, you have decided to expand the business by purchasing more tangible assets in order to meet the increasing demands of cakes and breads. Your clerk, Sarah, is indecisive to determine the appropriate depreciation methods for the three newly purchased tangible assets which are industrial oven, van and chiller as shown in TABLE Q2. As a graduate in Business Management from Universiti Teknologi PETRONAS, help Sarah by proposing the best depreciation method for each of the assets. Show all computations with reasons for each possible method. TABLE Q2: Information on tangible assets Asset Item Cost Estimated Useful Life Industrial oven RM10,500 5 Van RM65,000 6 Chiller RM13,000 7 Scrap Value RM2,500 RM10,000 RM1,500
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