Question # 4) (Marks 6) Company purchased a machine on 1 January 2011 at a list price of Rs.600,000, subject to a trade discount of 5% under the credit term 2/10, n/30. The payment was made within discount period. The company incurred the following expenditures: Sales tax @ 5% on net cash price. Freight - in Rs. 10,000. Import duty Rs.6,000. Custom duty Rs.8,500. Insurance - in - transit Rs. 13,970. . Installation charges Rs. 12,000. During installation a part of machine was damaged and was repaired at a cost of Rs.4,800. Test running cost Rs.3,000. . Foundation charges Rs. 10,000. Three year fire insurance policy Rs.90,000. Furthermore, company use Straight line method to recorded depreciation, it is estimated that the salvage value of machine Rs. 50,000 and estimated life in year is 10 years, company's accounting period ends on 31 December each year. REQUIRED: a) Compute the cost of machine. b) Compute the depreciation upto 31 December 2012