a. Explain the depreciation method used by Maxim Sdn Bhd

b. Explain the suitability of the depreciation method

Question 3 Maxim Sdn Bhd bought a lorry for business at cost of RM17,000. The lorry is expected to last for 5 years and then be sold for scrap for RM2,000. The annual depreciation charged to profit and loss account of Maxim Sdn Bhd is as following: Year 1 2 3 4 5 RM 5,950 3,868 2,514 1,634 1,034 5 Required: (a) Explain the depreciation method used by Maxim Sdn Bhd (show relevant workings). [3 marks] Explain the suitability of the depreciation method. [5 marks] (b)