The following information pertains to a company, trading as Doolittle Traders: Balances as at 31 March 2019:
Office furniture at cost 190 000
Vehicles at cost 200 000
Accumulated depreciation: Office furniture (30 September 2018) 73 200
Accumulated depreciation: Vehicles (31 March 2018) 10 800
Profit on sale of office furniture 3 480
Depreciation (office furniture) 1 280.
Additional information 1) On 30 September 2018 office furniture with a cost price of $20 000 was sold for $15,000. On the same date office furniture to the amount of $40 000 was purchased on credit, in order to replace the furniture that was sold. All the necessary accounting entries in respect of these transactions were done correctly. Doolittle uses the cost model to value its property plant and equipment.
2. The following (outstanding) amounts have not yet been provided for:
2.1 Depreciation On the office furniture - at 20% per annum on the diminishing balance method.
• On the vehicles-according to the straight-line method. The expected lifespan of each vehicle is estimated to be 10 years. The residual value of all the vehicles in total is estimated at $20 000. No vehicles were acquired or disposed of during the year.
Required: 3.1 In accordance with IAS 16, Property Plant and Equipment, Calculate and 1show depreciation as an adjustment in the general journal on 31 March 2019.
3.2 Prepare Property Plant and Equipment note as at 31 March 2019 to support 10 the amount in the Statement of Financial Position.