a vehicle costs pound 15 000 and is to be depreciated using the reducing balance met 611260

A vehicle costs £15,000 and is to be depreciated using the reducing balance method with a percentage rate of 20 per cent. Depreciation to be charged on this vehicle will be as follows:

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Cost of vehicle	16,000
Depreciation in year 1 (20% of £15,000)	3,000
Net book value at end of year 1	12,000
Depreciation in year 2 (20% of £12,000)	2,400
Net book value at end of year 2	9,600
Depreciation in year 3 (20% of £9,600)	1,920
Net book value at end of year 3	7,680
Depreciation in year 4 (20% of £7,680)	1,636
Net book value at end of year 5	6,144
Depreciation in year 5 (20% of £5,144)	1,229
	4,915