On 2 January 2018, Johnston Ltd purchased a machine with a list price of $224,900 (including GST) and credit terms of 2/10, n/30. Payment was made within the discount period. Freight costs of $5,200 plus GST and installation costs of $5,070 plus GST were also paid. The machine has a useful life of 4 years and a residual value at the end of its useful life of $23,000.

a)Determine the amount that should be debited to the machinery account and prepare a general journal entry to record the purchase, assuming a financial year ending 31 December

B) General journal to record purchase of machine, plus freight, installation cost and GST

C) Determine the amount of depreciation expense for each year of the 4 yrs ending 31 December assuming use of

1) Straight line depreciation method

2) Diminishing balance method of depreciation

	2018	2019	2020	2021
Straight Line
Diminishing balance