On 1 January 2015 a business purchased a laser printer costing £1,800. The printer has an estimated life of four years after which it will have no residual value. It is expected that the output from the printer will be:

Required:

(a) Calculate the annual depreciation charges for 2015, 2016, 2017 and 2018 on the laser printer on the following bases:
(1) the straight line basis, (2) the diminishing balance method at 60 per cent per annum, and (3) the units of output method.
Note: Your workings should be to the nearest £.

(b) Suppose that in 2018 the laser printer were to be sold on 1 July for £200 and that the business had chosen to depreciate it at 60 per cent per annum using the diminishing balance method applied on a month for month basis.
Reconstruct the following accounts for 2018 only:
(1) the Laser Printer account, (2) the Provision for Depreciation - Laser Printer account, and (3) the Assets Disposals account.

Transcribed Image Text:

Year 2015 2016 Sheets printed 35,000 45,000 2017 45,000 2018 55,000 180,000