a) A Company purchased equipment for RO 50,000 with an estimated useful life of 20 years....

a) A Company purchased equipment for RO 50,000 with an estimated useful life of 20 years. At the end of the 10 year, company determined that the equipment would last only 5 more years. Does this revision affect depreciation calculated previously? Yes or no, justify your answer.
b) You are required to calculate the rate of depreciation and the depreciation to be charged at the end of each year by using reducing balance method for 4 years. Life of the asset 4 years Scrap value at the end of 4 years RO 25,000 Original Investment RO 800,000

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jeff jeffy answered 1 year ago

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