JAMB Accounts Principles of Accounts 2013 Paper

Concept:The straight-line method spreads depreciation evenly over an asset's useful life.Explanation:Cost of the machine = $\#35,000$Present scrap value = $\#15,000$Useful life = $5$ yearsDepreciable amount = Cost $-$ Scrap value = $\#35,000 - \#15,000 = \#20,000$Yearly depreciation = Depreciable amount $\div$ Useful life = $\#20,000 \div 5 = \#4,000$The scrap value of $\#9,000$ is the old estimate and is not used when the present scrap value is given.Answer:A. $\#4,000$