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Foster incorporated, a registered VAI vendor, bought a delivery vehicle on the day they opened the doors business on 1 November 20.1. The purchase price of the vehicle was R205 200, including VAT. They decided that the accounting date would be 31 October annually. On 1 November 20.4 the vehicle was sold to Hanrod Traders for R102 600 cash (including VAT). Receipt no. RC374 was issued. The following represents a detailed statement of depreciation charges on the vehicle from the date of purchase until the date of sale: Period of depreciation 1 Nov 20.1 - 31 Oct 20.2 1 Nov 20.2 - 31 Oct 20.3 1 Nov 20.3 31 Oct 20.4 Calculation R180 000 x 20% (R180 000 - 36 000) x 20% (R180 000 - 64 800) x 20% Depreciation R 36 000 R 28 800 R 64 800 R 23 040 R 87 840

Foster incorporated, a registered VAI vendor, bought a delivery vehicle on the day they opened the doors business on 1 November 20.1. The purchase price of the vehicle was R205 200, including VAT. They decided that the accounting date would be 31 October annually. On 1 November 20.4 the vehicle was sold to Hanrod Traders for R102 600 cash (including VAT). Receipt no. RC374 was issued. The following represents a detailed statement of depreciation charges on the vehicle from the date of purchase until the date of sale: Period of depreciation 1 Nov 20.1 - 31 Oct 20.2 1 Nov 20.2 - 31 Oct 20.3 1 Nov 20.3 31 Oct 20.4 Calculation R180 000 x 20% (R180 000 - 36 000) x 20% (R180 000 - 64 800) x 20% Depreciation R 36 000 R 28 800 R 64 800 R 23 040 R 87 840

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Use the information at the top of this screen (next to Instructions) to complete the general ledger of Foster Incorporated:

 

 

Foster Incorporated, a registered VAT vendor, bought a delivery vehicle on the day they opened the doors of their business on 1 November 20.1. The purchase price of the vehicle was R205 200, including VAT. They decided that the accounting date would be 31 October annually. On 1 November 20.4 the vehicle was sold to Hanrod Traders for R102 600 cash (including VAT). Receipt no. RC374 was issued. The following represents a detailed statement of depreciation charges on the vehicle from the date of purchase until the date of sale: Period of depreciation 1 Nov 20.1 - 31 Oct 20.2 1 Nov 20.2 - 31 Oct 20.3 1 Nov 20.3 31 Oct 20.4 Calculation R180 000 x 20% (R180 000 - 36 000) x 20% (R180 000 64 800) x 20% Depreciation R 36 000 R 28 800 R 64 800 R 23 040 R 87 840
Transcribed Image Text:Foster Incorporated, a registered VAT vendor, bought a delivery vehicle on the day they opened the doors of their business on 1 November 20.1. The purchase price of the vehicle was R205 200, including VAT. They decided that the accounting date would be 31 October annually. On 1 November 20.4 the vehicle was sold to Hanrod Traders for R102 600 cash (including VAT). Receipt no. RC374 was issued. The following represents a detailed statement of depreciation charges on the vehicle from the date of purchase until the date of sale: Period of depreciation 1 Nov 20.1 - 31 Oct 20.2 1 Nov 20.2 - 31 Oct 20.3 1 Nov 20.3 31 Oct 20.4 Calculation R180 000 x 20% (R180 000 - 36 000) x 20% (R180 000 64 800) x 20% Depreciation R 36 000 R 28 800 R 64 800 R 23 040 R 87 840
Date 20.4 Nov Date 20.4 Nov Date 20.4 Nov Date 20.4 1 1 1 1 Details Balance Details Details Vehicles Details Balance Fol b/d Fol V GJ Fol GJ Fol b/d General ledger of Foster Incorporated Amount 87 840 Amount Amount Amount Vehicles V 20.4 Nov Date V 180 000 Accumulated depreciation: Vehicles Date Asset disposal Date 20.4 XXXX Nov Nov Bank 1 20.4 1 Balance Date Details Asset disposal 1 Details Details Accumulated depreciation Loss on sale of vehicle Details V GJ Fol Amount V Fol b/d Fol GJ CBR GJ Fol Amount Amount Amount 180 000 87 840 87 840 90 000 <
Transcribed Image Text:Date 20.4 Nov Date 20.4 Nov Date 20.4 Nov Date 20.4 1 1 1 1 Details Balance Details Details Vehicles Details Balance Fol b/d Fol V GJ Fol GJ Fol b/d General ledger of Foster Incorporated Amount 87 840 Amount Amount Amount Vehicles V 20.4 Nov Date V 180 000 Accumulated depreciation: Vehicles Date Asset disposal Date 20.4 XXXX Nov Nov Bank 1 20.4 1 Balance Date Details Asset disposal 1 Details Details Accumulated depreciation Loss on sale of vehicle Details V GJ Fol Amount V Fol b/d Fol GJ CBR GJ Fol Amount Amount Amount 180 000 87 840 87 840 90 000 <
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Step 1 Description

According to the given question, we are required to prepare the general ledger of Foster Incorporated.

 

General ledger:

The general ledger refers to the master set of accounts that summarize all financial data, and debit & credit accounts validated by a trial balance. For example, assets account, capital account are the general ledger accounts

 

 

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