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State the reasons for the difference?

State the reasons for the difference?

FINANCIAL ACCOUNTING
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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State the reasons for the difference?

A company resident in Jamaica purchased the following assets in 2021: Cost $ USD 38,000 50,000 4,000 72,000 Asset Honda Motor car purchased in March 2020 Heavy Equipment Computer (CPU) Factory Buildings The corresponding capital deduction rates for structures and improvements, motor vehicles, heavy equipment, and extra heavy equipment in Trinidad and Tobago are 10%, 30%, 33.33%, and 40%. In Jamaica, the capital allowance for plant and machinery with an eight-year life was 12.5%, while it was 20% for heavy machinery/equipment, general plant and machinery, and equipment. Assets Honda Heavy equipment Computer (CPU) Factory Buildings Capitat Allowance Difference Trinidad & Tobago Jamaica Rate Cost Rate Amount Cost $38,000.00 30.00% $11,400.00 $38,000.00 20.00% $50,000.00 33.33% $16,665.00 $50,000.00 12.50% $4,000.00 33.33% $72,000.00 10.00% Amount $7,600.00 $3,800.00 $6,250.00 $10,415.00 $1,333.20 $4,000.00 20.00% $800.00 $533.20 $7,200.00 $72,000.00 20.00% $14,400.00 -$7,200.00 (a) State the reasons for the difference.|
Transcribed Image Text:A company resident in Jamaica purchased the following assets in 2021: Cost $ USD 38,000 50,000 4,000 72,000 Asset Honda Motor car purchased in March 2020 Heavy Equipment Computer (CPU) Factory Buildings The corresponding capital deduction rates for structures and improvements, motor vehicles, heavy equipment, and extra heavy equipment in Trinidad and Tobago are 10%, 30%, 33.33%, and 40%. In Jamaica, the capital allowance for plant and machinery with an eight-year life was 12.5%, while it was 20% for heavy machinery/equipment, general plant and machinery, and equipment. Assets Honda Heavy equipment Computer (CPU) Factory Buildings Capitat Allowance Difference Trinidad & Tobago Jamaica Rate Cost Rate Amount Cost $38,000.00 30.00% $11,400.00 $38,000.00 20.00% $50,000.00 33.33% $16,665.00 $50,000.00 12.50% $4,000.00 33.33% $72,000.00 10.00% Amount $7,600.00 $3,800.00 $6,250.00 $10,415.00 $1,333.20 $4,000.00 20.00% $800.00 $533.20 $7,200.00 $72,000.00 20.00% $14,400.00 -$7,200.00 (a) State the reasons for the difference.|
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