Subsection 4.2. Accounting for depreciation and disposal of non-current assets for Accounting, O Level - revisedeck

4.2. Accounting for depreciation and disposal of non-current assets

A subsection of Accounting, 7707, through 4. Accounting procedures

Listing 10 of 32 questions

Brad purchased a machine for $1000 on 1 January 2019. The machine was expected to last for four years and have no residual value. On 31 December 2019 the same machine cost $1200 to purchase. At which value should the machine be included in the statement of financial position on 31 December 2019?

7707_s20_qp_11

MCQ

2020

Paper 1, Variant 1

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Elzevir purchased a motor vehicle costing $8000 on 1 January 2018. It is depreciated at 40% on the reducing balance basis. Which journal entry records the depreciation for the year ended 31 December 2019?

7707_s20_qp_12

MCQ

2020

Paper 1, Variant 2

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Atif depreciates his motor vehicles at a rate of 20% per annum using the reducing balance method. On 1 May 2021, Atif owned motor vehicles which cost $35 000. At that date, the motor vehicles had been depreciated by $12 600. What was the balance on Atif’s provision for depreciation account on 1 May 2022?

7707_s22_qp_11

MCQ

2022

Paper 1, Variant 1

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The financial year of Yeung ends on 31 March. On 1 April 2021, he purchased a machine for $4000. He estimated that it would have a useful working life of 3 years and a residual value of $100. Yeung uses the straight-line method of depreciation. The machine was sold on 1 April 2022 for $1500. What was the loss on disposal?

7707_s22_qp_11

MCQ

2022

Paper 1, Variant 1

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Which statement about the reducing balance method of depreciation is not correct?

7707_s22_qp_12

MCQ

2022

Paper 1, Variant 2

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The financial year of Yeung ends on 31 March. On 1 April 2021, he purchased a machine for $4000. He estimated that it would have a useful working life of 3 years and a residual value of $100. Yeung uses the straight-line method of depreciation. The machine was sold on 1 April 2022 for $1500. What was the loss on disposal?

7707_s22_qp_12

MCQ

2022

Paper 1, Variant 2

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Which statement about depreciation is correct?

7707_s23_qp_11

MCQ

2023

Paper 1, Variant 1

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Ravi’s financial year ends on 30 April. Ravi bought a motor vehicle for $8000 on 1 May 2020 and sold it for $4050 on 1 May 2022. He uses the reducing balance method of depreciation at 20% per annum. What would be recorded in the income statement for the year ended 30 April 2023 for the disposal of the motor vehicle?

7707_s23_qp_12

MCQ

2023

Paper 1, Variant 2

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Mandeep depreciates his motor vehicles at the rate of 20% using the straight-line method. A full year’s depreciation is provided in the year of purchase. Mandeep bought a motor vehicle on 1 January 2017 for $20000. On 1 June 2020 he bought a second motor vehicle for $10000. What was the depreciation charge on motor vehicles for the year ended 31 December 2020?

7707_s24_qp_11

MCQ

2024

Paper 1, Variant 1

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Elzevir purchased a motor vehicle costing $8000 on 1 January 2018. It is depreciated at 40% on the reducing balance basis. Which journal entry records the depreciation for the year ended 31 December 2019?

7707_s24_qp_12

MCQ

2024

Paper 1, Variant 2

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Questions Discovered

32