Questions from Financial Accounting

Q: Plant was purchased in the year for £10,000.

Plant was purchased in the year for £10,000. It has been decided to provide for depreciation on a reducing balance basis (25 per cent). A full year’s depreciation is charged in the year of purchase....

Q: An item of plant and machinery was sold within the year for

An item of plant and machinery was sold within the year for £5,000. The asset cost the company £10,000 over two years ago. The balances on the cost account and accumulated depreciation account were £1...

Q: Pusher commenced business on 1 January 20X7 with two lorries – A

Pusher commenced business on 1 January 20X7 with two lorries – A and B. A cost £1,000 and B cost £1,600. On 3 March 20X8, A was written off in an accident and Pusher received £750 from the insurance c...

Q: Makers and Co. is a partnership with a small factory on

Makers and Co. is a partnership with a small factory on the outskirts of London. They decide to erect an extension to their factory. The following items appear in the trial balance of the firm, as at...

Q: The statement of financial position of Beta Ltd as at 30 June

The statement of financial position of Beta Ltd as at 30 June 20X8 shows motor vehicles as follows: Vehicles are depreciated on the straight line basis over a five-year life. Depreciation is charged...

Q: The following transactions are to be recorded. At the beginning of

The following transactions are to be recorded. At the beginning of year 1 an allowance for irrecoverable debts account is to be opened. It should show an allowance of 2 per cent against trade receivab...

Q: The statement of financial position as at 31 December 20X8 of Zoom

The statement of financial position as at 31 December 20X8 of Zoom Products Ltd included: The financial statements for the year ended 31 December 20X8 included an allowance for irrecoverable debts a...

Q: Enter the following transactions in the books of ‘Seamus McKee’ for

Enter the following transactions in the books of ‘Seamus McKee’ for November (use T accounts). 1 Nov Started business with £10,000 in the bank 2 Nov Paid for advertising by debit card: £130 3 Nov Pai...

Q: Because of the doubtful nature of some debts, P. Rudent

Because of the doubtful nature of some debts, P. Rudent instructed his accountants to make a specific allowance in the financial statements for the year ended 30 June 20X8 against the following debts:...

Q: YEAR 1 1. The balance on trade receivables at the

YEAR 1 1. The balance on trade receivables at the year-end is £110,000. 2. Two of the balances in the sales ledger have to be written off. One is £4,500, the other is £5,500. 3. The company is to prov...