On 1 January 2012 Dee Ltd acquired electronic equipment for $10 000,net of GST.It is estimated it will have no residual value.If depreciation is provided at 10% p.a.on the diminishing-balance basis,the depreciation charge for the year ended 31 December 2014 is:

Question

Quizplus · Accepted Answer

To calculate the depreciation charge, first, we need to find the carrying amount of the equipment as of 31 December 2014.

In 2012, the carrying amount of equipment = $10,000 
Depreciation for 2012 = $10,000*10% = $1,000 
Carrying amount as of 31 December 2012 = $9,000 
Depreciation for 2013 = $9,000*10% = $900 
Carrying amount as of 31 December 2013 = $8,100 
Depreciation for 2014 = $8,100*10% = $810

Therefore, the depreciation charge for the year ended 31 December 2014 is $810.

Option C) is the correct answer.

On 1 January 2012 Dee Ltd Acquired Electronic Equipment for $10