IGCSE Accounting Paper-1: Specimen Questions with Answers 82 - 84 of 214

Passage

Aieno bought fixed asset at a cost of $50000 on 1st Aprils 2014. Calculate its net book value as on 31st March 2016 if it is depreciated:

Question number: 82 (3 of 4 Based on Passage) Show Passage

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Short Answer Question▾

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Which method of depreciation is used for live –stock and state your reason also

Explanation

Revaluation method.

The revaluation method is suitable for asset like live – stock because which call for special consideration and no other method are suitable for secure satisfactory results. It is very simple to understand and use. The difference between the asset value at the beginning and at the end is depreciated and charged to profit and loss account. If the value of asset at the end of year are higher than the beginning then the difference is ignored.

Question number: 83 (4 of 4 Based on Passage) Show Passage

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At 20 % per annum on the written down value method:

Explanation

$32000

The depreciation is charged on the reduced value of the asset for every year. The written down value method is also known as diminishing value method.

Depreciation on 31st March 2015 =

Depreciation on 31st March 2016 =

Net Book Value as on 31st March 2016 =

Question number: 84

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MCQ▾

Question

Which one of the following is also called Book of final entry or Book of secondary entry?

Choices

Choice (4) Response

a.

Trial Balance

b.

Journal

c.

Balance sheet

d.

Ledger

Answer

d.

Explanation

Ledger is also called as Book of final entry or Book of secondary entry. The ledger contains classified and permanent record of all transactions which are involved in the business. Thus ledger is collection of all transaction.