Question
Unisoft Limited bought a Machine for $259,000 and the useful life of the machine is estimated to be 4 years. The salvage value of the
Unisoft Limited bought a Machine for $259,000 and the useful life of the machine is estimated to be 4 years. The salvage value of the machine at the end of its life span is expected to be $9,000. The estimated running hours of the machine are given below:
Year Running Hours
1 4,290
2 3,960
3 3,425
4 825
Calculate the annual depreciation for 3 years using the following methods of depreciation:
(i) Straight Line Method
(ii) Units of Use Method
(b) Briefly discuss the following accounting concepts that are used in the preparation of financial statements:
(i) Historical Cost Concept
(ii) Going Concern Concept
(iii) Accounting Period Concept
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