17/1/18 Q Iam learning accounts. How to calculate this? Can anyone explain the reasons for the workings?
On 1 January 2017, Nico owned motor vehicles costing $26 340 with accumulated depreciation of $9 950 On 1 October 2017 a motor vehicle purchased on 1 April 2016 for $4 200, with a carrying value of $2 940, was sold. Motor vehicles are depreciated at 20% per annum, using the straight line method on the basis of one month’s ownership equals one month’s provision for depreciation. Nico maintains a cash float of $500 and all sales are made for cash. During the year ended 31 December 2017, the following cash transactions were recorded.
Cash banked $83 350 General expenses $13 800 Motor expenses $4 950 Proceeds from sale of motor vehicle $ 2 100
4a) Calculate the profit or loss on disposal of the motor vehicle. The model answer is ($840) I got wrong answer.
4b) Calculate the total depreciation charge for motor vehicles for the year ended 31 Dec 2017. The model answer is $4428 + $630 = $5058 / $3951 + $1107 = $5058
On 1 January 2017, Nico owned motor vehicles costing $26 340 with accumulated depreciation of $9 950 On 1 October 2017 a motor vehicle purchased on 1 April 2016 for $4 200, with a carrying value of $2 940, was sold. Motor vehicles are depreciated at 20% per annum, using the straight line method on the basis of one month’s ownership equals one month’s provision for depreciation. Nico maintains a cash float of $500 and all sales are made for cash. During the year ended 31 December 2017, the following cash transactions were recorded.
Cash banked $83 350 General expenses $13 800 Motor expenses $4 950 Proceeds from sale of motor vehicle $ 2 100
4a) Calculate the profit or loss on disposal of the motor vehicle. The model answer is ($840) I got wrong answer.
4b) Calculate the total depreciation charge for motor vehicles for the year ended 31 Dec 2017. The model answer is $4428 + $630 = $5058 / $3951 + $1107 = $5058