On 1 October 2011, Building Together Pty (Ltd) purchased an eight-wheeler truck for the delivery of sand and stone. The truck was ready for use on the purchase date. The truck had a purchase price of R870 000 and a residual value of R160 000 and was expected to be used evenly over 6 years. On 28 February 2013, the business purchased and installed an additional unit to the truck that sweeps excess stone and sand off the back of the truck. The total cost of the unit (including installation) amounted to R195 000. It is expected that the new unit will be disposed of on the same date as the truck. The new unit has a residual value of R35 000. 

Please calculate the depreciation expense for the year ended 31 July 2014.

Answer rating: 100% (QA)

October 1 2011 purchased truck 870000 residual value160000 useful lif... View the full answer