What is the carrying amount of the asset on january

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Question 1. The A business purchased a motor car on 1 July 2013 for $20,000. It is to be depreciated at 20 per cent per year on the straight line basis, assuming a salvage value at the end of five years of $4,000, with a proportionate depreciation charge.

What is the carrying amount (net book value) of the asset on 1 January 2015.

A $14,000

B $15,200

C $4,000

D $20,000

Question 2. XYZ Company bought a new printing machine on 1 January 20X0. The cost of the machine was $80,000. The installation costs were $6,000, the delivery expenses of $2,000 and professional fees were $1,000.

What should be the net book value on 31 December 20X1, if the salvage value is $3,000 and useful life is 10 years and the company uses declining balance method (20% rate)?

Reference no: EM132588068

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