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

Accounting for non-current assets — practice question

On 1 January 2020, a business acquired new delivery vehicles. The information provided is as follows. • total purchase cost: $300\,000$ • cost of painting the delivery vehicles in the company’s colours: $4\,000$ • total annual maintenance cost: $16\,000$ The company uses the reducing balance method to depreciate delivery vehicles at a rate of $40\%$ per annum. What is the depreciation charge for the delivery vehicles for the year ended 31 December 2021?

  • A$72\,000$
  • B$72\,960$
  • C$75\,840$
  • D$76\,800$

Worked solution & mark scheme

This 1-mark question has a full step-by-step worked solution and mark scheme.

  • Full mark scheme, point by point
  • Step-by-step worked solution
  • Write your answer & get it marked instantly by AI