Accounting 9706 · AS & A Level · Accounting for non-current assets

Accounting for non-current assets — practice question

On 31 December 2018, a business had a non-current asset with a net book value of $18000$. It had been bought in the year ended 31 December 2017. Depreciation is applied at a rate of $25\%$ per annum by the reducing balance method. In the year when it is purchased, a full year’s depreciation is charged. What was the original cost of the non-current asset?

  • A$22500$
  • B$24000$
  • C$27000$
  • D$32000$

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