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

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

A machine that originally cost $10000$ was depreciated over two years at $10\%$ per annum by the straight-line method. It was later sold for cash, and the loss on disposal was $700$. On the same day, a replacement machine was purchased for $12400$ cash. What was the net decrease in the cash balance?

  • A$3700$
  • B$5100$
  • C$11700$
  • D$13100$

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