Statement of financial position and of profit

Reference no: EM131003953

On 1 January 20X7, Nyvice Ltd. purchases a specialized machine tool for €20 000. The useful life of the machine tool is estimated to be five years. The residual value at the end of its useful life is expected to be zero. On 1 January 20X8, Nyvice purchases another machine tool for €4000. This has an ex- pected useful life of four years and a residual value of €400. On 31 December 20X9, the company sells the first machine tool for €6000. Nyvice Ltd. uses the straight-line depreciation method.

Required:

Show how the statement of financial position and the statement of profit or loss of Nyvice Ltd. are affected by the this purchase for the years 20X7, 20X8 and 20X9.

Reference no: EM131003953

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