Question
Wollongong Constructions Ltd purchased new building equipment on 1 January 2022, at a cost of $442,500. The accountant estimated the building equipment would have a
Wollongong Constructions Ltd purchased new building equipment on 1 January 2022, at a cost of $442,500.
The accountant estimated the building equipment would have a useful life of 5 years and a residual value of $25,000:
Required
a) Calculate the amount of depreciation expense for the years ending 30 June 2022 and 30 June 2023, using the following methods:
- Straight-line.
- Diminishing balance.
b) Discuss how the units of production method for depreciation differs from the straight line and diminishing balance methods?
Step by Step Solution
There are 3 Steps involved in it
Step: 1
a Depreciation expense for the years ending 30 June 2022 and 30 June 2023 using the straightline method The straightline method calculates depreciatio...
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Step: 2
Step: 3
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Intermediate Accounting
Authors: James D. Stice, Earl K. Stice, Fred Skousen
16th Edition
324376375, 0324375743I, 978-0324376371, 9780324375749, 978-0324312140
