On March 10, 2023, Bonita Limited sold equipment that it bought for $99,600 on August 20,...

Transcribed Image Text:

On March 10, 2023, Bonita Limited sold equipment that it bought for $99,600 on August 20, 2016. It was originally estimated that the equipment would have a useful life of 12 years and a residual value of $12,000 at the end of that time, and depreciation has been calculated on that basis. The company uses the straight-line method of depreciation and prepares its financial statements under IFRS. (a) Calculate the depreciation charge on this equipment for 2016 and for 2023, and the total charge for the period from 2017 to 2022, inclusive, under each of the following six assumptions for partial periods: (Round answers to O decimal places, e.g. 5,275.) 1. Depreciation is calculated for the exact period of time during which the asset is owned. (Use 365 days for your base.) 2. Depreciation is calculated for the full year on the January 1 balance in the asset account. 3. Depreciation is calculated for the full year on the December 31 balance in the asset account. 4. Depreciation for a half year is charged on plant assets that are acquired or disposed of during the year. 5. 6. Depreciation is calculated on additions from the beginning of the month following their acquisition and on disposals to the beginning of the month following the disposal. Depreciation is calculated for a full period on all assets in use for over half a year, and no depreciation is charged on assets in use for less than half a year. (Use 365 days for your base.) nptions 1. 2. 3. 4. 5. 6. +A $ 2016 $ +A 2017-2022 64 2023 +A Tot On March 10, 2023, Bonita Limited sold equipment that it bought for $99,600 on August 20, 2016. It was originally estimated that the equipment would have a useful life of 12 years and a residual value of $12,000 at the end of that time, and depreciation has been calculated on that basis. The company uses the straight-line method of depreciation and prepares its financial statements under IFRS. (a) Calculate the depreciation charge on this equipment for 2016 and for 2023, and the total charge for the period from 2017 to 2022, inclusive, under each of the following six assumptions for partial periods: (Round answers to O decimal places, e.g. 5,275.) 1. Depreciation is calculated for the exact period of time during which the asset is owned. (Use 365 days for your base.) 2. Depreciation is calculated for the full year on the January 1 balance in the asset account. 3. Depreciation is calculated for the full year on the December 31 balance in the asset account. 4. Depreciation for a half year is charged on plant assets that are acquired or disposed of during the year. 5. 6. Depreciation is calculated on additions from the beginning of the month following their acquisition and on disposals to the beginning of the month following the disposal. Depreciation is calculated for a full period on all assets in use for over half a year, and no depreciation is charged on assets in use for less than half a year. (Use 365 days for your base.) nptions 1. 2. 3. 4. 5. 6. +A $ 2016 $ +A 2017-2022 64 2023 +A Tot

Answer rating: 100% (QA)

To calculate the depreciation charge for each assumption we need to determine the number of days in each partial period Here are the calculations for each assumption 1 Depreciation is calculated for t... View the full answer