Accounting in organizations .depreciations methods . P@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@

QUESTION 1 Valenda Pty Ltd operates four types of Machinery. Because of their varied functions, management has decided that four different depreciation methods will be used to determine depreciation charges. Information on the equipment is summarised as follows: Machine 1 March 2015 lJune20l5 15 Oct2015 Purchase date 23 April 2015 Purchase Price $93,000 $25,500 S39,700 $47,800 Installation cost SZ,400 $2,000 0 Sl,200 Residual Value $ I 0,000 $5,500 $4,600 $9,000 Useful life/ 8 years 10 years 20,000 hours 6 years number of hours Sumof-the- years-digit Depreciation method Diminishing Straight-line Units of Production Balance (based on hours) Machine type 3 was used for 5,200 hours in the year ended December 20l5; and 7,600 hours in the year ended December 20 l 7. Required a) Assuming that Valenda Pty Ltd's financial year ends on 31 December, calculate the depreciation charges for 20l5, 2016 and 2017 for each type of machinery (show all workings). b) On 1 January 20l8, an overhaul of the machine type 2 was made at a cost of $35,000. Because of this overhaul, the useful life was increased by 2 years from 1 January 2018, and the residual value was amended to $20 000. The carrying amount of parts replaced was considered to be $3,500. 1. Prepare the general journal entries to record the overhaul expenditure on machine type 2 (show all workings). 2. Prepare the general journal entry to record the depreciation expense at 31 December 2018 (show all workings)