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ABC Pty Ltd is an australia company that runs a printing press. on 1 december 2017, one of the major pieces of equipment thatABC Pty Ltd uses in their business caught on fire. the machine had been purchased (and installed) on 1 september 2015.

The cost of machine was $90000. The machine had an effective life of 15 years and the company had always used the prime cost method to calculate the decline in value. Due to the fire, the machine was destroyed, The machine was insured, and the company received an insurance payment of $70000 on 1 March 2018

b) How would you answer change if the company had been using the diminishing value method to calculate the decline in value.


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