Question 1 1. Justin is the sole trader of DMK Trading who maintains his non-current assets at cost. On 1 January 2021, he owned the following non-current assets which had been depreciated on a monthly basis. Non-Current Cost Accumulated Depreciation Rate Assets Depreciation RM RM % Premise 420,000 63,000 15% on cost 115,500 16,700 10% on cost Motor vehicle Office equipment 12,000 1,200 5% on cost Current assets Bank 150,000 The accounting year end for the business is on 31 December every year. During the year ended 31 December 2021, the following transactions occurred: i. On 1 July 2021, the company purchase a new motor vehicle of RM65,000 on credit from Nissan Sdn Bhd. II. The business also renovated the premise. A total cost of RM45,000 was paid by issuing a cheque on 1 January 2021. You are required to show the following for the year ended 31 December 2021 Prepare journal entries for the transaction in i and ii. (a) (b) Non-current assets account. Show your working. (b) Accumulated depreciation of non-current assets account. Show your working (C) Extract Statement of Financial Position (extract) as at 31 December 2021.

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
icon
Related questions
Question
Question 1
1.
Justin is the sole trader of DMK Trading who maintains his non-current assets at
cost. On 1 January 2021, he owned the following non-current assets which had been
depreciated on a monthly basis.
Non-Current
Cost
Accumulated
Depreciation Rate
Assets
Depreciation
RM
RM
%
Premise
420,000
63,000
15% on cost
Motor vehicle
115,500
16,700
10% on cost
Office equipment
12,000
1,200
5% on cost
Current assets
Bank
150,000
The accounting year end for the business is on 31 December every year. During the
year ended 31 December 2021, the following transactions occurred:
i.
On 1 July 2021, the company purchase a new motor vehicle of RM65,000 on
credit from Nissan Sdn Bhd.
ii.
The business also renovated the premise. A total cost of RM45,000 was paid
by issuing a cheque on 1 January 2021.
You are required to show the following for the year ended 31 December 2021
Prepare journal entries for the transaction in i and ii.
(a)
(b)
Non-current assets account. Show your working.
(b)
Accumulated depreciation of non-current assets account. Show your working
(C)
Extract Statement of Financial Position (extract) as at 31 December 2021.
Transcribed Image Text:Question 1 1. Justin is the sole trader of DMK Trading who maintains his non-current assets at cost. On 1 January 2021, he owned the following non-current assets which had been depreciated on a monthly basis. Non-Current Cost Accumulated Depreciation Rate Assets Depreciation RM RM % Premise 420,000 63,000 15% on cost Motor vehicle 115,500 16,700 10% on cost Office equipment 12,000 1,200 5% on cost Current assets Bank 150,000 The accounting year end for the business is on 31 December every year. During the year ended 31 December 2021, the following transactions occurred: i. On 1 July 2021, the company purchase a new motor vehicle of RM65,000 on credit from Nissan Sdn Bhd. ii. The business also renovated the premise. A total cost of RM45,000 was paid by issuing a cheque on 1 January 2021. You are required to show the following for the year ended 31 December 2021 Prepare journal entries for the transaction in i and ii. (a) (b) Non-current assets account. Show your working. (b) Accumulated depreciation of non-current assets account. Show your working (C) Extract Statement of Financial Position (extract) as at 31 December 2021.
Expert Solution
steps

Step by step

Solved in 2 steps

Blurred answer
Knowledge Booster
Consolidations
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.
Recommended textbooks for you
FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
Accounting
ISBN:
9781259964947
Author:
Libby
Publisher:
MCG
Accounting
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education