Greg acquires an industrial chemical mixer for $9,800 for his manufacturing business and has it installed and ready for use on 26 July 2021 (assume 100% taxable purpose). Costs associated with the purchase and installation of the mixer below;

Installation costs: $1,000

Transport and insurance costs for delivery: $650

The effective life of the mixer is 6 years, and Greg’s business is registered for GST.

Required:

Calculate the decline in value of the asset for 30 June 2022 using the diminishing value method

Calculate the decline in value of the mixer for the 30 June 2022 using the prime cost method.

Would your answers be different if Greg’s business was not registered for GST?