Course Content
Basic Accountancy (Past Paper 2009)
All questions are taken from DAO Exam Part-I (Past Paper 2009)
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Classifying daily basis transactions according to their types
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What is Statement of Financial Position (SOFP)
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Write double-Entry Formula Entries
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Recording Cash Book Transaction
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Journal Entry
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Short Questions
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Find Depreciation: The Time Value of Money
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Reconciliation of Payables and Supplier’s Memorandum Ledger Balances
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Basic Accounting-I (Past Paper 2010)
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Let's Analyze your knowledge with Quiz
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Basic Accounting (Past Paper 2010)
Division Accounts Officer's Examination (Part-I) 2010 paper answers
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Present Journal entries from the enlisted transactions
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Transactions Typically Recorded in a Journal
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Security Aspects of Handling and Storing Money
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Define Bank Reconciliation & draw it benefits
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Bank Reconciliation Example
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Bad debt
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Good internal controls to support an efficient and reliable payroll system
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Replacing Machinery
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Dismantling Costs of Old Machine
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Basic Accounting Help Material
Short definition of the Accounting terms
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Book of Accounts
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Accounting Processes
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Single-entry and Double-entry accounting:
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Financial Statements (Assets, Liabilities, and Shareholders’ Equity)
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Difference between a balance sheet, an income statement and a cash flow statement
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What is the difference between a cash book and a bank statement?
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Course outline for Basic Accounting
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New Accounting Model (Exam-2009)
Books references: 1. Account Code (Volume III). 2. Chart of Accounts (Issued by CGA). 3. Manual Accounting Principles. 4. Accounting Policies and Procedures Manual.
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Select Suitable answers
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Write short notes on the following questions.
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Pass Journal Entries
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Reconciliation of Contractors’ Expenditure in APPM
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Treatment of Replacement Cheques, Unclaimed and Stale Cheques in APPM
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Business Communication (Exam 2009)
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Proposal for the Auditor General of Pakistan
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Write an essay on the new challenges emerging for the auditors
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What type of business skills are used in contract planning, execution, implementation and evaluation?
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Please comment on the following:
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Please comment in short on the following:
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Private: DAO Part-I Examination 2024 (Fresh Candidates) Past Papers
About Lesson
Q.6.
M/S. Mateen Engineering Ltd. Bought machinery on 1″ January, 2005 for Rs.260000/-.
It incurred transportation and installation expenses of Rs.20000/- in connection with the machinery.
Mateen Ltd. expects the useful life of the assets to be 6 years.
The estimated realizable value after 6 years is expected to be Rs.10000/-.
Calculate the depreciation for six years.
Answer:

calculate the depreciation for the machinery over a period of six years.

Given information:

  • Cost of machinery: Rs.260,000
  • Transportation and installation expenses: Rs.20,000
  • Useful life of the asset: 6 years
  • Estimated realizable value after 6 years: Rs.10,000

To calculate depreciation, we’ll use the Straight Line Method (SLM):

  1. Determine the total cost of the machinery:

    • Cost of machinery + Transportation and installation expenses = Rs.260,000 + Rs.20,000 = Rs.280,000

  2. Calculate annual depreciation:

    • Annual depreciation = (Cost of machinery – Estimated realizable value) / Useful life
    • Annual depreciation = (Rs.280,000 – Rs.10,000) / 6
    • Annual depreciation = Rs.270,000 / 6
    • Annual depreciation = Rs.45,000

  3. Depreciation for six years:

    • Total depreciation = Annual depreciation × Number of years
    • Total depreciation = Rs.45,000 × 6
    • Total depreciation = Rs.270,000

Therefore, the total depreciation for the machinery over six years is Rs.270,000.

Now we organize the depreciation calculations in a tabulated format:

Item Amount (Rs.)
Cost of machinery 260,000
Transportation and installation expenses 20,000
Total cost of machinery 280,000
Estimated realizable value after 6 years 10,000
Useful life of the asset 6 years
Annual depreciation 45,000
Total depreciation for 6 years 270,000

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