A-LevelAccountingAccounting for non-current assets9706/12 · Oct/Nov 2015 · Q131 Mark
A business depreciates its motor vehicles over four years using the straight-line method. A full year's depreciation is charged in the year of purchase, but none in the year of sale. A vehicle purchased on 1 July 2011 for $18000 had an estimated residual value of $4000. The vehicle was sold for $5000 on 31 December 2014. Which entry appeared in the income statement for the year ended 31 December 2014?
A$1000 loss
B$2500 loss
C$2500 profit
D$5000 profit
✓ Correct answer
B: $2500 loss
Practise more questions on this topic
Oracle Prep sorts past-paper questions by topic, so you can drill Accounting for non-current assets and see which topics are most likely to come up next.
Sign up free →