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a Ahmad bought a new equipment at RM120,000 on 1 July 2017

Accounting

a Ahmad bought a new equipment at RM120,000 on 1 July 2017. He was undecided whether to depreciate the equipment using straight line method or reducing method at 20% per annum The equipment is expected to have no residual value. You are required to calculate the amount of depreciation to be charged against each financial year ending 31 December 2017, 31 December 2018 and 31 December 2019 using the straight line method and reducing balance method. Show your answer in the following format: Financial Year ending : Straight Line Method Reducing Balance Method RM RM 31 December 2017 31 December 2018 31 December 2019 (9 marks) b. The following are balances brought forward from 31 December 2018 for KC Deco Center RM RM Motor Vehicles 100,000 Less: Provision for depreciation (20,000) 80,000 The motor vehicles were depreciated at 15% per annum using reducing balance method. KC bought a new vehicle on 1 October 2019. cost of the new vehicle was RM120,000. You are required to prepare the following accounts for financial year ending 31 December 2019 i. The Motor Vehicle Account ii. The Provision for Depreciation Account.

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Thanks for your question. Please note as per chegg policy only one question can be answered at a time. Below is the answer of your first question:

Year Depreciation as per SLM Depreciation as per RBM
31-12-17 24000 24000
31-12-18 24000 19200
31-12-19 24000 15360

Depreciation as per SLM:

Year Balance Working Depreciation
31-12-17 120000 120000*20% 24000
31-12-18 96000 120000*20% 24000
31-12-19 72000 120000*20% 24000

Depreciation as per reducing method:

Year Balance Working Depreciation
31-12-17 120000 120000*20% 24000
31-12-18 96000 96000*20% 19200
31-12-19 76800 76800*20% 15360

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