(20) QUESTION 2 REQUIRED Answer the following questions from the information giv
ID: 2328171 • Letter: #
Question
(20) QUESTION 2 REQUIRED Answer the following questions from the information given below. All workings must be shown DISPOSAL OF FIXED ASSETS 2.1 2.2 Calculate the depreciation for the current financial year on the vehicle that was sold Prepare the Fixed Asset Realisation account in the general ledger to reflect the disposal of the vehicle on 31 August 2016. 4 2.3 Calculate the depreciation for the current inancial year on the new vehicle acquired 2.4 Calculate the total cost price of the vehicles on 28 February 2017 2.5 Prepare the Accumulated Depreciation on Vehicles account in the general ledger to reflect al the entries up to the end of the financial year Prepare the following note to the financial statements (amount column for Vehicles only) as at 28 February 2017 Property, plant and equipment 2.6 INFORMATION Steers Enterprises owns a fleet of motor vehicles. The following baances appeared in the general ledger on 01 March 2016, the beginning of the financial year Vehicles at cost R1 000 000 R400 000 Accumulated depreciation on vehicles Additional information depreciation on this vehicle was R165 000 on 01 March 2016. Deprecation is provided for on vehicles at 20% per annum on the diminishing balance On 31 August 2016, a vehicle that cost R200 000 was sold for R32 000 cash. The accumulated On 01 December 2016 a new vehicle was purchased for R250 000 cash .Explanation / Answer
Answer :-
given information,
2.1. calculation of depreciation for the current financial year on the vehicle that was sold :-
=2,00,000 - 165,000
= $35,000
=35,000 * 20%
=$7,000
=7,000/2
=$3,500
2.2.fixed asset realisation account :-
=1,65,000 +3500
=1,68,500
2.3.calculation of depreciation for the current financial year on the new vehicle acquired:-
= 2,00,000 * 20%
= $50,000
= 50,000/4
=$12,500
2.4.calculation of total cost price of the vehicles on february 2017:-
= 10,00,000 - 2,00,000 + 250,000
=$10,50,000
2.5.accumulated depreciation account as on february 28 ,2017:-
depreciation for the year on vehicles available on march 2016 (d)
=( p -c)*20%
= ( 1000000 - 400000)*20%
= $1,20,000
= 400000 + 1,20,000 + 3500+ 12500
= $529,000
$1,68,500 ( from 2.2 bit )
= 529,000 - 360,500
=$360,500
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the beginning of the year in march 1,2016 vehicle at cost (p) $1,000,000 Accumulated depreciation on vechicle (q) $4,00,000 for the vehicles sold on august 31 2016 cost of vehicle(r) $2,00,000 accumulated depreciation on march 01 2016(s) $1,65,000 selling price (t) $32,000 depreciation rate on diminishing balance(u) 20%Related Questions
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