Wrong Calculation. Need help on depreciation calculation

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6 July 2018 Q

Does anyone know how to calculate this with explanations for 4B. I got part 4B wrong. The model answer provided is $ 3070 ( How is this $3070 derived ? ) + $ 495 = $ 356.


Monow Manufacturing provided the following information at 1 June 2017.

Machinery – Cost $18 100 – Accumulated depreciation $8 350

On 1 January 2018 a machine was sold for $3 000 cash. The machine was purchased on 1 September 2015 for $6 600 On 1 March 2018 a new machine costing $9 900 was purchased. Depreciation is charged for each month of ownership at 20% per annum on a straight line basis.

4a Calculate for the machine disposed of:
(i) the total amount of depreciation charged. - Model answer is $3080
(ii) the profit or loss on disposal - Model answer is $520

((((( 4b Calculate the total depreciation charge on the machinery for the year ended 31 May 2018. Model answer is $3565 ))))

My workings for Part 4a (i)
4a (i) $ 6600 x 20% x 28 months / 12 months = $ 3080
4a (ii) $ 6600 - $3080 - $ 3000 = loss $520
 

Fidget

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It's because 7 months dep'n from June - Dec = 2112. After accounting for the disposal on 1st Jan 2018, dep'n goes down on existing assets, so Jan - May = 958. So the total dep'n for those is 2112+958 = 3070. Factor in the three months dep'n on the new asset from March - May = 495, and that takes you to the total for the year of 3070+495 = 3565.
 

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