Accumulated depreciation on the asset as at 31/12/81 was
N 2 487 500 .00
N 2 736 250 . 00
N 4 511 192.00
N 4 975 000 .00
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To find the accumulated depreciation on the asset as of 31/12/81, we can use the straight-line method. First, we need to calculate the annual depreciation expense.
Annual Depreciation Expense = (Historical Cost - Residual Value) / Estimated Useful Life
Annual Depreciation Expense = (#5,000,000 - #25,000) / 20
Annual Depreciation Expense = #4,975,000 / 20
Annual Depreciation Expense = #248,750
Since the asset was acquired on 1/1/71, we need to calculate the accumulated depreciation for 11 years (from 1971 to 1981).
Accumulated Depreciation = Annual Depreciation Expense x Number of Years
Accumulated Depreciation = #248,750 x 11
Accumulated Depreciation = #2,736,250
