Question: Holt plc purchased a computer for 8,000 on January 1, 2018. Straight-line depreciation is used, based on a 5-year life and a 1,000 residual value.

Holt plc purchased a computer for £8,000 on January 1, 2018. Straight-line depreciation is used, based on a 5-year life and a £1,000 residual value. In 2020, the estimates are revised. Holt now feels the computer will be used until December 31, 2021, when it can be sold for £500. Compute the 2020 depreciation.

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