1 A vehicle bought on 1 January 2010 cost £16,000. Its useful economic life is estimated at 4 years and its trade-in value at that point is estimated as being £4,000. During 2012 a review of the...

1

A vehicle bought on 1 January 2010 cost £16,000. Its useful economic life is estimated at

4 years and its trade-in value at that point is estimated as being £4,000.

During 2012 a review of the vehicle’s probable useful economic life suggested that it should be

retained until 1 January 2015 and its residual value should be £2,500.

Required:

What is the amount of straight line depreciation charged in the profit and loss account in the year

ending 31 December 2012 and the amount included in the balance sheet for accumulated depreciation

at that date?