A machine acquired on 1.1.2004 for £320,000 is being depreciated using the straight-line method, assuming 20 years economic life and a scrap value of £20,000. Calculate the depreciation to be written off in the year ended 31 December 2012, if a review undertaken on 1 January 2012 reveals the need for each of the changes listed below:

(a) The depreciation method is changed to the sum of the years’ digits

(b) Scrap value is revised to £120,000

(c) Estimate of economic life is revised from 20 years to 40 years

Transcribed Image Text:

X £30,769 £10,000 £4,500 Y Z £32,308 £27,692 £6,667 £16,667 £7,500 £5,625