Disclose the property, plant and equipment note in the financial statements of Mountaineers (Pty) Ltd the year ended 31 December 2025.

• Land:

  • Cost: R1 500 000 (total) - R1 000 000 (buildings) = R500 000
  • Accumulated Depreciation: R0 (Land is not depreciated)
  • Carrying Amount: R500 000

• Buildings:

  • Cost: R1 000 000
  • Depreciation rate: 2% per annum (straight-line)
  • Depreciation per year: R1 000 000 $\times$ 2% = R20 000
  • Accumulated Depreciation at 1 Jan 2025 (for 2022, 2023, 2024): R20 000 $\times$ 3 years = R60 000
  • Carrying Amount: R1 000 000 - R60 000 = R940 000

• Motor Vehicles:

  • No motor vehicles were owned at 1 January 2025.
  • Cost: R0
  • Accumulated Depreciation: R0
  • Carrying Amount: R0

• Equipment (Original):

  • Cost: R50 000 (acquired 1 January 2022)
  • Depreciation rate: 1/4 years = 25% per annum (straight-line)
  • Depreciation per year: R50 000 $\times$ 25% = R12 500
  • Accumulated Depreciation at 1 Jan 2025 (for 2022, 2023, 2024): R12 500 $\times$ 3 years = R37 500
  • Carrying Amount: R50 000 - R37 500 = R12 500

• Additions:

  • Motor Vehicles (1 August 2025): R250 000
  • New Equipment (1 July 2025): R75 000

• Disposals (Original Equipment on 1 July 2025):

  • Cost of disposed equipment: R50 000
  • Depreciation for 2025 on disposed equipment (6 months): R50 000 $\times$ 25% $\times$ (6/12) = R6 250
  • Total Accumulated Depreciation on disposed equipment: R37 500 (at 1 Jan 2025) + R6 250 (2025) = R43 750
  • Carrying amount of disposed equipment: R50 000 - R43 750 = R6 250

• Depreciation for 2025:

  • Buildings: R1 000 000 $\times$ 2% = R20 000
  • Motor Vehicles:
    • Acquired 1 August 2025, 5 months of depreciation.
    • Diminishing balance rate: Assuming double the straight-line rate (1/5 years = 20%), so 20% $\times$ 2 = 40%.
    • Depreciation: R250 000 $\times$ 40% $\times$ (5/12) = R41 667
  • Equipment:
    • Original equipment (6 months): R6 250 (calculated above)
    • New equipment (acquired 1 July 2025, 6 months): R75 000 $\times$ 25% $\times$ (6/12) = R9 375
    • Total Equipment Depreciation: R6 250 + R9 375 = R15 625

Property, Plant and Equipment

Accounting Policies

• Land is not depreciated as it is considered to have an indefinite useful life.
• Buildings are depreciated on the straight-line method over their estimated useful life of 50 years (2% per annum).
• Motor vehicles are depreciated using the diminishing-balance method at 40% per annum. The residual value is estimated at 15% of cost.
• Equipment is depreciated on the straight-line method over its estimated useful life of 4 years (25% per annum).