# Wrong Calculation. Need help on depreciation calculation

#### nacggk

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

VIP Member
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.