Answer Happy

atlons/AnnotationApp.aspx?Annotation AccessArea=1&AnnotationOfUserid=0&IsReadOnly=True&Learning Objectid=308209428&Learning Objectinstanceid=4394339878 MobileBrowser-NotDefined Section B Answer 2 questions only. This section carries 40 marks. Question B1 A business financial year runs from 1st April to 31st March each year. On 1st July 2019 a vehicle was purchased for use in the business at a cost of £20,500. The vehicle is paid for by cheque. Depreciation is to be charged at the rate of 30% per year using the Reducing Balance method applied for a full year in year of purchase and none in year of disposal. Separate accounts are kept in the books to record the cost and provision for depreciation of fixed assets. Required: (a) Calculate the annual depreciation for the Vehicle over the two years of its [2] life. (b) Show for the years 2019 / 2020 and 2020 / 2021 the accounting entries [4] within the Vehicle Cost Account and Accumulated Depreciation for Vehicle Account. (c) Show the Written Down Value of the Vehicle as per the Statement of [2] Financial Position as at 31st March 2020 and 2021, (d) If a non-current asset cost £23,000, the accumulated depreciation on this [6] asset is £18,200 and the asset is sold for £5,800. Calculate the profit or loss on disposal. [ii] Write up the relevant ledger accounts to record this disposal. (e) Explain the importance of accounting for depreciation. [6]
70/erowser"NODE Question B2 A small business had £500.00 cash and a bank overdraft of £743.00 on 31st January 2021. The business made the following cash and bank transactions during February 2021: 03 Banked £150.00 cash 07 Paid wages in cash £175.00 08 Banked cheque from Customer A for £843.00 12 Cash sales £350.00 14 Paid wages in cash £185.00 17 Banked a cheque for £254.00 from Customer B after deduction of £6.00 discount 18 Paid the balance on Supplier A account £300.00 by cheque after deduction of 2% discount 21 Withdrew £200.00 from the bank for office use 23 Paid wages in cash £180.00 25 Paid Supplier B by cheque £138.00 28 Received balance of Customer C account of £200.00 by cheque after allowing for a 2% discount Required: (a) [10] Prepare the small business Three Column Cash Book for the month of February 2021. The small business Bank Statement for February showed the following entries: Credit Balance Bank Statement for February Debit 2021 01 Balance 743.00 Dr 07 150.00 843.00 593.00 Dr 250.00 Cr 08 12 25.00 17 Banking Banking Charges Banking Direct Debit - Water Credit Transfer Cheque 254.00 225.00 Cr 479.00 Cr 424.00 Cr 509.00 Cr 18 55.00 19 85.00 21 200.00 309.00 Cr