a) At 31 July 20X6, Helios International had non-current assets which had cost $310,000. At the same
Question:
a) At 31 July 20X6, Helios International had non-current assets which had cost $310,000. At the same date, the accumulated depreciation on the assets was $120,000. The company had not disposed of any non-current assets during the year to 31 July 20X7, but acquired an asset at a cost of $79,200 on 1 January 20X7.
Helios International depreciates non-current assets at a rate of 25% per annum.
What is the company's depreciation charge for the year to 31 July 20X7 using:
a. The straight line method
b. The reducing balance method
Assume that depreciation is charged from the first year of acquisition.
b) During the year to 30 June 20X7, Eugene Ltd sold a non-current asset for $36,000. It had been acquired three years ago at a cost of $180,000. At the date of disposal of the asset, the accumulated depreciation was $138,000.
What was the profit or loss on disposal, and what journal entries are needed to record the disposal?