Accounting 9706 · AS & A Level · Accounting for non-current assets
Accounting for non-current assets — practice question
Myra runs a delivery business. The information below relates to her business’s delivery vehicles. Vehicles are depreciated by the straight-line method at $20\%$ per annum. Depreciation is calculated month by month. The business’s financial year end is 31 December.
(a)[4]
Calculate the balance on the provision for depreciation of vehicles account as at 31 December 2019.
(b)[5]
Prepare the vehicle disposal account in full.
(c)[3]
Prepare the provision for depreciation of vehicles account for the year ending 31 December 2020.
(d)[2]
Explain one reason why some businesses might choose to use the revaluation method of depreciation.
(e)[1]
State how the annual depreciation charge is worked out using the revaluation method.
Worked solution & mark scheme
This 15-mark question has a full step-by-step worked solution and mark scheme. One marking point: “A: depreciation for 2 years 5 months = $14 500” …