Question

Question 3 Test Bank: Q1Sep 19 Florence prepares the company year end accounts on 31st December annually. The following transactions occurred during the year 2017: Date of Assets Useful life Percentage Disposal Cost (RM) purchase (year) for Value depreciation (RM) 1-7-2014 Motor Vehicles 10 100,500 1-1-2014 Equipment 142,000 1-1-2014 Labelling 10% 65,000 Machine The company uses: iv) straight line method of depreciation for motor vehicles and equipment. v) reducing balance method for labelling machine with the rate 10% vi) The company implement month to month basis of depreciation. (Depreciation is calculated based on number of month the assets exist in the business) All payments and receipts for the above transactions were made through cheque/bank. You are required to prepare: c) Depreciation schedule for motor vehicles, equipment and labelling machine from year of purchase until 31 December 2017. (10 m) d) Prepare the non current assets section in statement of financial position (5 m)

Answer 1

It is not a test question, but a practice question of Sept. 2019 Test, thus providing helping solution to student:

Q3)
c) Depreciation schedule:
Motor Vehicles:
Date	Cost	Depreciation	Book Value
1/7/2014	100500		100500
31/12/2014		(100500*6)/(10*12)=5025	95475
31/12/2015		10050	85425
31/12/2016		10050	75375
31/12/2017		10050	65325
Equipment:
Date	Cost	Depreciation	Book Value
1/1/2014	142000		142000
31/12/2014		142000/8=17750	124250
31/12/2015		17750	106500
31/12/2016		17750	88750
31/12/2017		17750	71000
Labelling Machine:
Date	Cost	Depreciation(10%of BV)	Book Value
1/1/2014	65000		65000
31/12/2014		6500	58500
31/12/2015		5850	52650
31/12/2016		5265	47385
31/12/2017		4738.5	42646.5
d) Balance Sheet (abstract) :		Amount $
Assets:
Non-current assets:
Motor Vehicles	100500
Less:Acc. Dep. - MV	35175	56325
Equipment	142000
Less:Acc. Dep. - Equip	71000	71000
Labelling Machine	65000
Less:Acc. Dep. - LM	22353.5	42646.5