Accounting 0452 · IGCSE · Accounting for depreciation and disposal of non-current assets

Accounting for depreciation and disposal of non-current assets — practice question

On 1 January 2018, Elzevir bought a motor vehicle for $8000. Depreciation is charged at $40\%$ using the reducing balance basis. Which journal entry should be used to record depreciation for the year ended 31 December 2019?

  • AIncome statement / Provision for depreciation of motor vehicles: debit $1920, credit $1920
  • BIncome statement / Provision for depreciation of motor vehicles: debit $3200, credit $3200
  • CProvision for depreciation of motor vehicles / Motor vehicles: debit $1920, credit $1920
  • DProvision for depreciation of motor vehicles / Motor vehicles: debit $3200, credit $3200

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