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help in accounting paper 3 plz

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Nanavel:
Thankyouuu ..

In Motor vehicle >> provision for depriciation of motor vehicles account >> Disposal of motor vehicle account

What are the Essential steps required to solve this ...  in the year O/N/2006 page 12 and 13 and 14 .

Actually , I didnt had a teach from a very long time just the past four months of my IGCSE she came and she tought me the very little and totally Escaped the These parts that i am asking right now ..

It is going to be very hard for me as i have both accounting and chemistry to study them on the same day ..

Saiki you could talk to me Online if you wish .. ^-^ "

saiki:
Motor vehicle- u add the vehicles u buy, n the day ur sellling it, u remove that vehicle from that a/c (at cost price) as if it never existed - this u add in disposal...

Provision- u add provision every year for all vehicles. n when ur selling one of them, again remove all traces of that vehicle (remove the depn charged for it for all years) - this u add in disposal... ( n dont forget to charge depn for remaining vehicles at the end of that year.)

disposal- add motor vehicle cost, add depn, balance of that will be the net book value... then enter the selling price n if its above the balance then u made profit in the book or else made loss in the book... then transfer the balance to pnl n close that a/c (make it 0)

frenzy1234:
*censored* hell accounts and chem tommorow chem is fine but a/c im screwed!!
sm1 please help me with the entries of good will pls!!
 :o

Nanavel:
Motor vehicle- u add the vehicles u buy, n the day ur sellling it, u remove that vehicle from that a/c (at cost price) as if it never existed - this u add in disposal...

Provision- u add provision every year for all vehicles. n when ur selling one of them, again remove all traces of that vehicle (remove the depn charged for it for all years) - this u add in disposal... ( n dont forget to charge depn for remaining vehicles at the end of that year.)

I didnot understand it >> could you please do it with examples or use the question in the paper Page 12 ..

how did they get the 9000 as a balance in the provision for depreciation in Page 13 year O/N/06 .. what is the formula ??

what are the formula's used in these ??

saiki:
Motor vehicle-
oct 1 2004 bought 2 vehicle (20000 n 16000) hence debit motor vehicle a/c since asset increase.
sept 30 2005 depreciate the 2 vehicles- 25% of 20000 + 25% of 16000 = 5000+4000=9000 -> credit since negative asset a/c

disposal->

remove vehicle VWU from motor vehicle a/c -> credit 16000 (the cost of that car)
remove prov depn -> remove 4000 from the a/c since until now the total dep charged is 4000 for that car... debit 4000

enter both of them in disposal a/c-> debit 16000, credit 4000, hence balance is 12000 dr which is net book value...

then it is sold at 12500 hence credit 12500 n balance now is 500cr, n since sold higher then NBV, it is a profit.

then at end of year, transfer the balance of the a/c to pnl n close disposal a/c (make it 0)....


also at the end of year, dont forget to charge depn in provision for depreciation a/c for the remaining vehicle KUA at 25% of cost =5000


hope thats more clear

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