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Posted: October 17th, 2022

Fistral Ltd acquires a blank-making machine

Fistral Ltd acquires a blank-making machine â blanks are the inner foam core of a surfboard â for the following amounts:Initial price paid to the supplier $70000Cost to deliver the machine to the site $5000Amount to paint the company name on the machine $1500Amount paid to an engineer to fit the machine ready for work $35000Insurance cover taken out on the machine $2200Repairs made to replace bolts which had dislodged during transit $500Required:(i) Calculate the value of the machine for depreciation purposes. Explain your reasons for including or excluding certain items in the calculation;(ii) Choose a method of depreciation taking into consideration the impact of each available method on yearly profits;

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