Question 5 Charlie's Handyman Services purchased a new vehicle 1 July 2017. The vehicle cost $57,000, the vehicle needed

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Question 5 Charlie S Handyman Services Purchased A New Vehicle 1 July 2017 The Vehicle Cost 57 000 The Vehicle Needed 1 (28.96 KiB) Viewed 44 times

Question 5 Charlie's Handyman Services purchased a new vehicle 1 July 2017. The vehicle cost $57,000, the vehicle needed to be fitted with an attached toolbox to make it useful for the business costing $4,550. With the new fit out it was estimated that the vehicle would have a useful life of five (5) years and a salvage value of $2,500. a. What is the cost of the vehicle to Charlie's Handyman Services? [1 mark] b. What would be the amount of accumulated depreciation and the carrying value of the asset at the 30 June 2020, if we were to use the straight-line depreciation method? [2 marks] c. What would be the amount of accumulated depreciation and the carrying value of the asset at the 30 June 2020, if we were to use the diminishing balance method of depreciation? [2 marks] d. If we sold the vehicle for $12,500 at the 30 June 2020 what profit or loss would occur under b. and c.? [2 marks] e. Do we record depreciation in the Cash Flow Statement? Give the reason for your answer (Maximum 100 words) [3 marks] [Total for Question 5 = 10 marks]