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Chapter 5
Example 3
Required:
Use the following information relating to an individual non-current asset
to calculate depreciation using reducing-balance method.
Cost at the start of year 1 $10,000
Reducing balance % 20% per year
Estimated residual value $0
Example 3: Solution
This would be presented in the annual financial statements as follows:
Year Cost $ Acc Dep $ SOFP CV SP/L Dep’n Exp
Year 1
Year 2
Year 3
Year 4
Year 5
Illustrations and further practice
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