Residual value of the item of equipment

Reference no: EM13954708

The following non-current assets are bought by C. Brewer for use in her business on 1.1.X0.

	Cost	Estimated useful life	Estimated residual value at end of useful life
Building	(£) 60,000	(years) 50	(£) 10,000
Vehicle	12,000	10	300
Equipment	9,000	10	800

Buildings and equipment are to be depreciated using the straight line method, vehicles reducing balance of 25%.

The vehicle is sold for £6,500 on 1.12.X2 and an item of equipment costing £1,500 for £1,200 on the same date. Assume that the residual value of the item of equipment sold was estimated to be £100 at its date of purchase. Assume a full year's depreciation in the year of purchase and none in the year of sale.

Show the asset accounts, provision for depreciation accounts, sale of asset accounts and extracts from the income statement and balance sheet in respect of these assets for the years ended 31.12.X0, 31.12.X1, 31.12.X2.

Reference no: EM13954708

Questions Cloud

Depreciation and the sale of asset accounts : Prepare the ledger accounts for the two years ending 30.9.X6 and 30.9.X7 for each non-current asset together with related provision for depreciation and the sale of asset accounts. Show the balance sheet extract for fixed assets as at the two year..

Solutions will have the lowest freezing point : Which of the following solutions will have the lowest freezing point? Can you explain which one with full solution, and explain why.

Organizational culture is considered product and process : Organizational culture is considered a product and a process. Discuss organizational culture as a product and a process. Which concept do you favor and why?

Identify the stage of the disease for this patient : Identify the stage of the disease for this patient. Identify how the disease is different from similar diseases. Discuss the possible treatments for the disease.

Residual value of the item of equipment : The vehicle is sold for £6,500 on 1.12.X2 and an item of equipment costing £1,500 for £1,200 on the same date. Assume that the residual value of the item of equipment sold was estimated to be £100 at its date of purchase. Assume a full year's depr..

Calculate the new breakeven point in monthly sales dollars : MSM company sells clothing for young adults. The firm has normal monthly fixed costs Calculate the new breakeven point in monthly sales dollars

What is the inventory turnover for the month : A manufacturing plant averaged $740 of raw materials, $230 of work-in-process inventory, and $1030 of finished goods inventory during the month. If the cost of goods sold this month amounted to $10,000, what is the inventory turnover for the month?

Which is the best definition of culture : Which of the following is the best definition of culture? 1 A lifestyle 2 A set of rules 3 A learned systems of shared understandings 4 Music

How technology affect delivery of health care in radiologic : How has technology affected the delivery of health care in radiologic and imaging sciences? How has fusion technology influenced patient care and diagnosis and how has this development impacted the growth of professionals within allied health?

User Account

All Pages