Question

In: Statistics and Probability

Sheldon's Science Shop purchased shop equipment for $80,000 on 1 July 2018, with an effective life...

Sheldon's Science Shop purchased shop equipment for $80,000 on 1 July 2018, with an effective life of 4 years and a residual value of $20,000. Ignore GST for this question.

Using the straight line method of depreciation, calculate the book value [written-down value] of the shop equipment at the end of the 2019-20 financial year.

Solutions

Expert Solution

Steps to Calculate the book Value-

Step 1- Write down all the given values ( Information Available in excel worksheet)

Step 2- Find the depreciable Base cost = Cost-Residual Value

Step 3 -Find the depreciable expense = Depreciable Cost/Useful Years

Step 4 - Prepare Depreciable Schedule consists of Depreciable cost, Depreciable expense, Accumulated depreciation, and Book value each year.

I have mentioned all the formulas in the excel worksheet.

Thank You!

orchestra answered 1 year ago
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