ACCO 240 Lecture Notes - Current Asset, Income Statement

• School: Concordia University
• Department: Accountancy
• Course: ACCO 240
• Professor: All

Document Summary

At 1 october 2002 jim had fixed assets as follows: Jim"s policy is to provide for a full year"s depreciation in the year of acquisition, but no provision is made in the year of disposal. Land nil: buildings written off over 25 years, on the straight line basis, machinery 20% per annum, on the reducing balance basis. During the year to 30 september 2003, jim added an extension to the buildings at a cost of. He also acquired a new machine, by paying the dealer ,000 by cheque and trading in an old machine for ,500. The machine traded in had been acquired in january 2000 at a cost of ,000. Jim has asked why depreciation is not charged on the land, but is charged on other fixed assets. Simon depreciates his machinery at a rate of 20% per annum on a reducing balance basis.