Accounting for Financial Services:Depreciation

BANKING DIPLOMA EXAMINATION

Banking Diploma Courses in Bangladesh under The Institute of Bankers, Bangladesh(IBB)

Accounting for Financial Services-JAIBB

Depreciation

Question:  November 2009/ November 2010

Problem : X Company Limited purchase a machinery Tk. 5,10,000.00 on January 2000. Useful Life time is 5 Years, Scrap value Tk. 10,000.00, during year 2000 working hours were 2000 and production units were 15000. Total Estimated working hours is 25000 and Estimated units is 2, 00,000.

Requirements:

 Calculate depreciation for the year 2001 and each of the following methods:

1. Straight line method
2. Working hour method
3. Sum of year digit method
4. Declining Balance method
5. Units of output method

Solution: