Q.3 Jamil started a business on 1 January 2014. He considered using the straight line (equal instalment) method to depreciate all his non-current assets. REQUIRED (a) Name one other method Jamil could use to depreciate his non- current assets. (b) Suggest two reasons why the straight line (equal instalment) method would not be a suitable method of depreciation to apply to the hand tools used in Jamil's factory. 2. - (2) Jamil decided to depreciate his office machinery at 20% per annum using the straight line (equal instalment) method calculated on a month-by-month basis from the date of purchase to the date of disposal. He provided the following information. 2014 January 1 Purchased office machine A, S15 000, paying by cheque. 2016 October 1 Purchased office machine B. SI8 000, paying by cheque. 2017 July 1 Purchased office machine C, $20 000, on credit from XY Limited XY Limited agreed to accept office machine A in part exchange at a valuation of $6000 REQUIRED () Calculate the depreciation on office machinery for the year ended 31 December 2016 Show your calculations and insert your answers in the spaces provided Calculation of depreciation for the year ended 31 December 2016 pre Calculation of depreciation for the year ended 31 December 2017 A [3] (e) Prepare the following accounts in the ledger of Jamil for each of the two years ended 31 December 2016 and 31 December 2017 Balance the accounts and bring down the balances on 1 January 2017 and 1 January 2018 Office machinery account re 2018 Provision for depreciation of office machinery account Date SD 2010 () Calculate the profit or loss on the disposal of office machine A. - Q.3 Jamil started a business on 1 January 2014. He considered using the straight line (equal instalment) method to depreciate all his non-current assets. REQUIRED (a) Name one other method Jamil could use to depreciate his non- current assets. (b) Suggest two reasons why the straight line (equal instalment) method would not be a suitable method of depreciation to apply to the hand tools used in Jamil's factory. 2. - (2) Jamil decided to depreciate his office machinery at 20% per annum using the straight line (equal instalment) method calculated on a month-by-month basis from the date of purchase to the date of disposal. He provided the following information. 2014 January 1 Purchased office machine A, S15 000, paying by cheque. 2016 October 1 Purchased office machine B. SI8 000, paying by cheque. 2017 July 1 Purchased office machine C, $20 000, on credit from XY Limited XY Limited agreed to accept office machine A in part exchange at a valuation of $6000 REQUIRED () Calculate the depreciation on office machinery for the year ended 31 December 2016 Show your calculations and insert your answers in the spaces provided Calculation of depreciation for the year ended 31 December 2016 pre Calculation of depreciation for the year ended 31 December 2017 A [3] (e) Prepare the following accounts in the ledger of Jamil for each of the two years ended 31 December 2016 and 31 December 2017 Balance the accounts and bring down the balances on 1 January 2017 and 1 January 2018 Office machinery account re 2018 Provision for depreciation of office machinery account Date SD 2010 () Calculate the profit or loss on the disposal of office machine A
