A company purchases a machine with an expected useful life of 6 years for 9000. After two years of use management revised expected useful life to 8 years . The machine is to be depreciated at 30 % per annum on the reducing balance basis. A full years depreciation is charged in the year of purchase with none in the year of sale. During year 4 sold for 3000. What is the profit or loss on disposal?

Answer rating: 100% (QA)

First lets calculate the annual depreciation expense The machine is depreciated at a rate of 30 per ... View the full answer