**(a) Prime cost method:** $30,000 × (1 ÷ 5) = **$6,000**

**(b) Diminishing value method:** $30,000 × (2 ÷ 5) = **$12,000**

**Controlling authority:** Division 40 of the *Income Tax Assessment Act 1997* (Cth), which governs capital allowances (decline in value of depreciating assets). The prime cost method is set out in section 40-75 and the diminishing value method (with the 200% rate for assets first used on or after 10 May 2006) in section 40-72.