A business with a reporting period of the 12 months ended 30 June buys a non-current asset on 1 July 20X3 for £200,000. Depreciation is charged at 15% per annum on the reducing balance basis. On 30 June 20X5 the asset was sold for £54,800. What was the loss on sale of the asset?
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A business with a reporting period of the 12 months ended 30 June buys a non-current asset on 1 July 20X3 for £200,000.
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- Consider the following situations and determine (1) which type of liability should be recognized (specific account), and (2) how much should be recognized in the current period (year). A. A business depreciates a building with a book value of $12,000, using straight-line depreciation, no salvage value, and a remaining useful life of six years. B. An organization has a line of credit with a supplier. The company purchases $35,500 worth of inventory on credit. Terms of purchase are 3/20, n/60. C. An employee earns $1,000 in pay and the employer withholds $46 for federal income tax. D. A customer pays $4,000 in advance for legal services. The lawyer has previously recognized 30% of the services as revenue. The remainder is outstanding.On July 1, 2018, Mundo Corporation purchased factory equipment for 50,000. Residual value was estimated at 2,000. The equipment will be depreciated over 10 years using the double-declining balance method. Counting the year of acquisition as one-half year, Mundo should record 2019 depredation expense of: a. 7,680 b. 9,000 c. 9,600 d. 10,000Bliss Company owns an asset with an estimated life of 15 years and an estimated residual value of zero. Bliss uses the straight -line method of depreciation. At the beginning of the sixth year, the assets book value is 200,000 and Bliss changes the estimate of the assets life to 25 years, so that 20 years now remain in the assets life. Explain how this change will be accounted for in Blisss financial statements, and compute the current and future annual depreciation expense.
- Harbin Ltd. has a 31 December year end. A motor vehicle was acquired in July 2019 for £20,000. Depreciation is charged at 25% reducing balance basis, with a full year’s charge in year of purchase and none in year of sale. The vehicle was sold for £10,000 in July 2021. What is the profit or loss on disposal? a) Loss £850b) Profit £1,250c) nil profit or lossd) Loss £1,250At 31 December 2003 Q, a limited liability company, owned a building that had cost $800,000 on 1 January 1994. It was being depreciated at two per cent per year. On 31 December 2003 a revaluation to $1,000,000 was recognised. At this date the building had a remaining useful life of 40 years. Which of the following pairs of figures correctly reflects the effects of the revaluation? Depreciation charge Revaluation reserve for year ended 31 December 2004 as at 31 December 2003 $ $ A 25,000 200,000 B 25,000 360,000 C 20,000 200,000 D 20,000 360,000On 1 January 2018, Kyle Trading Sdn. Bhd. purchased a photocopy machine at a price of MYR 800,000. This piece of office equipment is depreciated at a rate of 15% per annum using the straight-line method. Calculate the asset’s net book value on 31st December 2020, assuming that the business closes its account on that date. Select one: A. MYR 580,000 B. MYR 580,000 C. MYR 560,000 D. MYR 240,00
- ABC, whose reporting period is the 12 months ended 31 December, has charged depreciation monthly at the rate of 10% per annum on cost on an item of plant bought on 1 September 20X0 costing £30,000. The depreciation method was changed from straight line to 10% reducing balance at the end of 20X3. The depreciation charge on this asset for 20X5 was:The following balances were extracted from the trial balance of XY Co Ltd as at 31st December 2010. • Buildings (at cost) 22,500 • Accumulated depreciation buildings 6,250 • Fixture and fittings (at cost) 6,000 • Accumulated depreciation fixture and fittings 1,400 The depreciation is charged annually on the cost of fixed assets held at the end of the financial year at the following rates: • Buildings 4% per annum • Fixtures and fittings 10% per annum The totalnet book value is?An asset's book value is $36,000 on January 1, Year 6. The asset is being depreciated $500 per month using the straight-line method. Assuming the asset is sold on July 1, Year 7 for $25,000, the company should record: A. Neither a gain or loss is recognized on this type of transaction. B. A gain on sale of $2,000. C. A loss on sale of $1,000. D. A gain on sale of $1,000. E. A loss on sale of $2,000.
- A business buys a machine for £120,000 on 1 January 1993 and another one on 1 July 1993 for £144,000. Depreciation is charged at 10% per annum on cost, and calculated on a monthly basis. What is the total depreciation charge for the two machines for the year ended 31 December 1993? A £13,200 B £19,200 C £21,600 D £26,400The net book value of a company's non-current assets was $200,000 at 1 August 20X8. During the year ended 31 July 20X9, the company sold non-current assets for $25,000 on which it made a loss of $5,000. The depreciation charge for the year was $20,000. What was the net book value of non-current assets at 31 July 20X9? A $150,000 B $155,000 C $160,000 D $180,000The carrying value of a company's non-current assets was $200,000 at 1 August 20X0. During the year ended 31 July 20X1, the company sold non current assets for $25,000 on which it made a loss of $5,000. The depreciation charge of the year was $20,000. What was the carrying value of non currenta assetsat 31 July 20X1?
