Consider the information provided below and then complete the table by entering the respective values. BBA (PTY) Ltd has an obligation to dismantle its plant at the end of 20 years. This is in accordance with the local legislative requirements. Assume the cost to construct the plant is R900 000. The plant was completed and available for use on 30 June 2021. The estimated residual value is R100 000. The plant was brought into use on 30 September 2021. The dismantling costs are R200 000. The applicable discount rate after tax (at 28%) is 7.2%. R Cost of the plant PV of the expected dismantling Cost price of the machine Depreciation for the first year - 2021 Carrying amount as at 31 December 2021
Consider the information provided below and then complete the table by entering the respective values. BBA (PTY) Ltd has an obligation to dismantle its plant at the end of 20 years. This is in accordance with the local legislative requirements. Assume the cost to construct the plant is R900 000. The plant was completed and available for use on 30 June 2021. The estimated residual value is R100 000. The plant was brought into use on 30 September 2021. The dismantling costs are R200 000. The applicable discount rate after tax (at 28%) is 7.2%. R Cost of the plant PV of the expected dismantling Cost price of the machine Depreciation for the first year - 2021 Carrying amount as at 31 December 2021
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
Consider the information provided below and then complete the table by entering the respective values.
|
BBA (PTY) Ltd has an obligation to dismantle its plant at the end of 20 years. This is in accordance with the local legislative requirements. Assume the cost to construct the plant is R900 000. The plant was completed and available for use on 30 June 2021. The estimated residual value is R100 000. The plant was brought into use on 30 September 2021. The dismantling costs are R200 000. The applicable discount rate after tax (at 28%) is 7.2%. |
|
|
R |
|
Cost of the plant |
|
|
PV of the expected dismantling |
|
|
Cost price of the machine |
|
|
|
|
|
|
|
|
Carrying amount as at 31 December 2021 |
|
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 5 steps
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education