Chad Partners: Balances on 30 June 2021. Vehicles R300 000 Accumulated depreciation R50 000. Adjustment Depreciation is calculated at 10% on cost. An old vehicle was disposed on 01 January 2022 for R20 000 cash. The disposed vehicle originally costed R25 000 and the Accumulated depreciation is R 3 000. Profit/loss for the disposed vehicle is: O A. Profit/loss R3 000 OB. Profit/loss R750 OC. Profit/loss R500 O D. Profit /loss R1 250
Chad Partners: Balances on 30 June 2021. Vehicles R300 000 Accumulated depreciation R50 000. Adjustment Depreciation is calculated at 10% on cost. An old vehicle was disposed on 01 January 2022 for R20 000 cash. The disposed vehicle originally costed R25 000 and the Accumulated depreciation is R 3 000. Profit/loss for the disposed vehicle is: O A. Profit/loss R3 000 OB. Profit/loss R750 OC. Profit/loss R500 O D. Profit /loss R1 250
Cornerstones of Financial Accounting
4th Edition
ISBN:9781337690881
Author:Jay Rich, Jeff Jones
Publisher:Jay Rich, Jeff Jones
Chapter7: Operating Assets
Section: Chapter Questions
Problem 6MCQ: Refer to the information for Cox Inc. above. What amount would Cox record as depreciation expense...
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Depreciation Methods
The word "depreciation" is defined as an accounting method wherein the cost of tangible assets is spread over its useful life and it usually denotes how much of the assets value has been used up. The depreciation is usually considered as an operating expense. The main reason behind depreciation includes wear and tear of the assets, obsolescence etc.
Depreciation Accounting
In terms of accounting, with the passage of time the value of a fixed asset (like machinery, plants, furniture etc.) goes down over a specific period of time is known as depreciation. Now, the question comes in your mind, why the value of the fixed asset reduces over time.
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