charges annually; the straight line method has high charges
in
the earlier years
of
the
assel's life and the reducing balance melhod has low charges
in
the
lat
er years.
EXHIBIT 9,10 Reducing Balance Method
of
Depreciation Adjustment
Years
2 3
4
5
Opening balance 10,000 6,000
3,600
2.t60
1.296
Less depreciation (shown
in
P&L alc) 4,000
2.400 1.440
664
516
Balance (value
in
each vear's balance sheel) 6,000
3,600 2,160
1
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