Chris purchased a new John Deere tractor for his farming business on 15 May 2018. He paid $45 000 cash for the tractor because he traded in an old tractor and was allowed $25 000 against the price of the new tractor. If he did not have the old tractor to trade-in the new John Deere would have cost $70 000. He expects that the tractor will be useful for 8 years and he wishes to depreciate the tractor using the diminishing value method. What amount can Chris claim as a deduction (to the nearest $) for the year ended 30 June 2020? Hint - you must first calculate depreciation for the 2018- & 2019-income years.

Chris purchased a new John Deere tractor for his farming business on 15 May 2018. He paid $45 000 cash for the tractor because he traded in an old tractor and was allowed $25 000 against the price of the new tractor. If he did not have the old tractor to trade-in the new John Deere would have cost $70 000. He expects that the tractor will be useful for 8 years and he wishes to depreciate the tractor using the diminishing value method. What amount can Chris claim as a deduction (to the nearest $) for the year ended 30 June 2020? Hint - you must first calculate depreciation for the 2018- & 2019-income years.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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