On January 1,20X1, Mighty Entity pays the fair value of $50,000 for a new piece of machinery with an estimated
useful life of 8 years. The machine has a drum that must be replaced every four years and costs $20,000 to replace. Continued operation of the machine requires an inspection every four years after purchase and the inspection cost is $4,000. Under IFRS, what is the depreciation expense for year 2?
Can someone help explain how to calculate the depreciation for the single year 2?
I have donethe work for this but confused on how you get a single year
Fair Value of Machinery Fair Value of Drum
Life 8 years 4 years
Depreciation for one year $3750 $5000
Total Depreciation $8750
If i am right with the work that i have above can someone help explain further how to calculate the answer for depcreciation for year 2.
Recently Asked Questions
- Tax return preparers may generally rely on a client's representations without verification unless a. The client is incompetent. b. The tax matter is complex.
- Two debts, the first of $600 due three months ago and the second of $1,500 borrowed two years ago for a term of four years at 7.5% compounded annually, are to
- Why does the after-tax cost of a deductible expense decrease as the taxpayer's marginal income tax rate increase?