Part A

The presence of discounts is a prominent factor both during the purchase and sale of a commodity:

With reference to the above statement answer the following questions:

1. Explain the different types of discounts used in various business transactions.

2. It is important to develop discount strategies in the business world to manufacturers, wholesalers, retailers and the ultimate consumers. Elucidate.

Part B

Modern Steels Mills LLC (MSM) is a prominent steel company and leading suppliers of trusted and quality steel products in all major markets. MSM purchased a machine on January 5, 2020 for OMR 16,700. Transportation costs amounted to OMR 300. The estimated useful life is 5 years, and the machine has a salvage value of OMR 2,000.

Required:

1. Prepare the depreciation schedule of a machinery for 5 years using written down value method of depreciation.

2. There are different depreciation methods, which allow businesses to determine the projected loss of value of certain assets over time or based on actual physical usage. Explain any two methods of depreciation other than the written down value method.