Disposal Account – NBC Institute

FA – Nov 2021 – L1 – Q1 – Non-current assets and depreciation | The IASB’s Conceptual Framework

Explanation of duties of those charged with governance and preparation of motor vehicle-related accounts, including cost, depreciation, and disposal.

Question

a) Those charged with governance describe the role of persons entrusted with an entity’s supervision, control, and direction, thus ordinarily accountable for ensuring that the entity achieves its objectives.

Required:
Explain FOUR (4) duties and responsibilities of those charged with governance.
(10 marks)

b) On 1 January 2020, the following was extracted from the books of Gaga:

Item	Amount (GH¢)
Motor vehicles at cost	150,800
Accumulated depreciation on vehicles	95,700

During the year, the following occurred:

On 1 February 2020, Motor Vehicle C was traded in against a motor vehicle D.
Motor Vehicle C was purchased on 1 September 2016 for GHȼ 80,000.
Gaga wrote a cheque of GHȼ 40,000 for Motor Vehicle D. On the date of purchase, the list price of Motor Vehicle D was GHȼ 71,400.
Motor Vehicles are depreciated at 20% per annum on a straight-line basis from the month of purchase to the month of sale.

Required:
Prepare the following accounts for the year ended 31 December 2020.
i) Motor Vehicle at cost.
ii) Motor Vehicle accumulated depreciation.
iii) Disposal account for Motor Vehicle C.
(10 marks)

Answer

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Tags: Accumulated Depreciation, Depreciation, Disposal Account, Governance, Motor Vehicles
Level: Level 1

Topic: Non-current assets and depreciation, The IASB’s Conceptual Framework
Series: NOV 2021

FA – Nov 2016 – L1 – Q1 – Non-current assets and depreciation

Prepare ledger accounts for Machinery, Accumulated Depreciation, Motor Vehicles, and Disposal of Motor Vehicles for PQ Ltd.

Question

PQ Ltd had, among others, the following balances in the books at 1st January 2015:

Description	Debit (GH¢)	Credit (GH¢)
Machinery at cost	750,000
Machinery accumulated depreciation		301,000
Motor vehicles at cost	1,000,500
Motor vehicles accumulated depreciation		402,000

The following information relates to the non-current assets for the financial year ended 31st December 2015:

a) On 1st July 2015, PQ Ltd purchased machinery at a cost price of GH¢75,000, paying by cheque.
b) On 1st December 2015, PQ Ltd purchased machinery at a cost price of GH¢27,600, on credit from BD Machinery Ltd.
c) No disposals of machinery took place during the year ended 31st December 2015.
d) Machinery is depreciated at 20% per annum using the straight-line method, the rate being charged for each proportion of the year the machinery is owned. No allowance is made for any residual value. All machinery held at 31st December 2015 had been purchased within the previous four years.
e) On 30th June 2015, motor vehicles which originally cost GH¢40,000 and with a net book value of GH¢16,000 at the date of sale were sold at a profit of GH¢600. The disposal receipt was paid into the bank account.
f) No purchases of motor vehicles took place during the year ended 31st December 2015.
g) Motor vehicles are depreciated at 25% per annum using the straight-line method, the rate being charged for each proportion of the year the motor vehicles are owned. No allowance is made for any residual value. All motor vehicles held at 31st December 2015 had been purchased within the previous three years.

Required:
Prepare the following ledger accounts of PQ Ltd for the year ended 31st December 2015, where appropriate showing the balance carried down to the next financial year. Dates are not required.
a) Machinery. (4 marks)
b) Accumulated Depreciation of Machinery. (4 marks)
c) Motor vehicles. (4 marks)
d) Accumulated Depreciation of Motor vehicles. (4 marks)
e) Disposal of Motor Vehicles. (4 marks)
(Total: 20 marks)

Answer

Find Related Questions by Tags, levels, etc.

Tags: Accumulated Depreciation, Disposal Account, Machinery Account, Motor Vehicles Account
Level: Level 1

Topic: Non-current assets and depreciation
Series: NOV 2016

FA – Nov 2021 – L1 – Q1 – Non-current assets and depreciation | The IASB’s Conceptual Framework

Explanation of duties of those charged with governance and preparation of motor vehicle-related accounts, including cost, depreciation, and disposal.

Question

Required:
Explain FOUR (4) duties and responsibilities of those charged with governance.
(10 marks)

b) On 1 January 2020, the following was extracted from the books of Gaga:

Item	Amount (GH¢)
Motor vehicles at cost	150,800
Accumulated depreciation on vehicles	95,700

During the year, the following occurred:

On 1 February 2020, Motor Vehicle C was traded in against a motor vehicle D.
Motor Vehicle C was purchased on 1 September 2016 for GHȼ 80,000.
Gaga wrote a cheque of GHȼ 40,000 for Motor Vehicle D. On the date of purchase, the list price of Motor Vehicle D was GHȼ 71,400.
Motor Vehicles are depreciated at 20% per annum on a straight-line basis from the month of purchase to the month of sale.

Answer

Find Related Questions by Tags, levels, etc.

Tags: Accumulated Depreciation, Depreciation, Disposal Account, Governance, Motor Vehicles
Level: Level 1

Topic: Non-current assets and depreciation, The IASB’s Conceptual Framework
Series: NOV 2021

FA – Nov 2016 – L1 – Q1 – Non-current assets and depreciation

Prepare ledger accounts for Machinery, Accumulated Depreciation, Motor Vehicles, and Disposal of Motor Vehicles for PQ Ltd.

Question

PQ Ltd had, among others, the following balances in the books at 1st January 2015:

Description	Debit (GH¢)	Credit (GH¢)
Machinery at cost	750,000
Machinery accumulated depreciation		301,000
Motor vehicles at cost	1,000,500
Motor vehicles accumulated depreciation		402,000

The following information relates to the non-current assets for the financial year ended 31st December 2015:

Answer

Find Related Questions by Tags, levels, etc.

Tags: Accumulated Depreciation, Disposal Account, Machinery Account, Motor Vehicles Account
Level: Level 1

Topic: Non-current assets and depreciation
Series: NOV 2016

Question Tag: Disposal Account

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FA – Nov 2021 – L1 – Q1 – Non-current assets and depreciation | The IASB’s Conceptual Framework

Explanation of duties of those charged with governance and preparation of motor vehicle-related accounts, including cost, depreciation, and disposal.

FA – Nov 2016 – L1 – Q1 – Non-current assets and depreciation

Prepare ledger accounts for Machinery, Accumulated Depreciation, Motor Vehicles, and Disposal of Motor Vehicles for PQ Ltd.

FA – Nov 2021 – L1 – Q1 – Non-current assets and depreciation | The IASB’s Conceptual Framework

Explanation of duties of those charged with governance and preparation of motor vehicle-related accounts, including cost, depreciation, and disposal.

FA – Nov 2016 – L1 – Q1 – Non-current assets and depreciation

Prepare ledger accounts for Machinery, Accumulated Depreciation, Motor Vehicles, and Disposal of Motor Vehicles for PQ Ltd.

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FA – Nov 2021 – L1 – Q1 – Non-current assets and depreciation | The IASB’s Conceptual Framework

Explanation of duties of those charged with governance and preparation of motor vehicle-related accounts, including cost, depreciation, and disposal.

You're reporting an error for "FA – Nov 2021 – L1 – Q1 – Non-current assets and depreciation | The IASB’s Conceptual Framework"

FA – Nov 2016 – L1 – Q1 – Non-current assets and depreciation

Prepare ledger accounts for Machinery, Accumulated Depreciation, Motor Vehicles, and Disposal of Motor Vehicles for PQ Ltd.

You're reporting an error for "FA – Nov 2016 – L1 – Q1 – Non-current assets and depreciation"

FA – Nov 2021 – L1 – Q1 – Non-current assets and depreciation | The IASB’s Conceptual Framework

Explanation of duties of those charged with governance and preparation of motor vehicle-related accounts, including cost, depreciation, and disposal.

You're reporting an error for "FA – Nov 2021 – L1 – Q1 – Non-current assets and depreciation | The IASB’s Conceptual Framework"

FA – Nov 2016 – L1 – Q1 – Non-current assets and depreciation

Prepare ledger accounts for Machinery, Accumulated Depreciation, Motor Vehicles, and Disposal of Motor Vehicles for PQ Ltd.

You're reporting an error for "FA – Nov 2016 – L1 – Q1 – Non-current assets and depreciation"

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