Provision

Question 1

Plant built on 01 Jun 2015.
Decommission on 30 Jun 2020.
Discount factor 0.567 and 12% rate.
Decommission cost 4’000 KUSD.

Answer 1

PV is 4’000*0.567 = 2’268
2’268 K’USD / 5 = 453,600 is depreciation
2’268 * 12% = 272,160 is financial cost.

453k + 272 is total PL charge.