Question
Depreciation of Fixed Assets A motor vehicle was purchased on 31 st March 2017 for $110,000 excluding GST. It has an expected useful life of
Depreciation of Fixed Assets
A motor vehicle was purchased on 31st March 2017 for $110,000 excluding GST. It has an expected useful life of 5 years. Depreciation is using the straight-line method. The motor vehicle is expected to have a residual value of $10,000. Balance day is 30 June each year:
Required:
( a )How much is depreciation each full year?
( b )How much is depreciation on 30 June 2017?
( c )Prepare a journal entry to record depreciation on 30 June 2017.
Date
Account
Debit
Credit
( d )Prepare a Balance Sheet extract for 30 June 2018, showing how the Motor Vehicle and
Accumulated Depreciation would appear.
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