Question 1

Straight Line depreciation of Furniture & Equipment for the month is calculated using the annual depreciation % rate. The fixed asset has a $35 000 salvage value at the end of its life. Hint: work out the Straight-Line rate (%) and use months to calculate depreciation not days.

Furniture and equipment at cost $274,000

Furniture and equipment Accumulated depreciation -$24,000

Total furniture and equipment $ 250,000

Question 2

Amortisation of leasehold improvements is based on the term of the lease which is 15 years. An adjusting entry is required for March to reflect amortisation of the leasehold

Improvements at cost $110,000

Improvement amortisation -$4,888

Total Leasehold improvements $105,112