United Ltd purchases a company car for £198,000 plus VAT at 17.5%. The car is expected to have a life of three years and a residual value of £90,000. Payment is made partly in cash and partly by trading in an old car with a net book value of £70,560 and a trade-in value of £54,000. The company uses the straight-line basis to depreciate its cars. What is the net book value of the car after one year? A £150,000 B £156,000 C £162,000 D £185,100

Q: Hauswirth Corporation sold (or exchanged) a warehouse in year 0. Hauswirth bought the warehouse…

A: Answer to question a. Purchase cost of warehouse $65,000 Less: Depreciation claimed till year 0…

Q: Keating Co. is considering disposing of equipment that cost $62,000 and has $43,400 of accumulated…

A: Capital budgeting is a critical financial management process used by businesses to evaluate and make…

Q: A company provides each of its directors with a car. It has purchased these at £35,000 each. After 4…

A: Depreciation is the amount of expense which shows the decrease in the value of asset over time by…

Q: Justice Inc. sold its old equipment with original cost of 2,000,000 and accumulated depreciation of…

A: When the asset is sold at a price higher than its book value, it is said to be sold at a profit.

Q: A company which uses the revaluation model for its PPE bought a building on 1 January 2014 for…

A: In the given question, we need to compute the revaluation loss that would affect the statement of…

Q: Llungby AB spent 1,000,000 krone in 2020 on the development of a new product. The company determined…

A: The journal entry is the first step where a business transaction is entered into the accounting…

Q: A company which uses the revaluation model for its PPE bought a building on 1 January 2014 for £10m.…

A: The question asked to find the correct answer from the available options.     Other comprehensive…

Q: Carolina Co. purchased a machine at a cost of $780,000 on January 1, 2016. On January 1, 2021, the…

A: Answer : Transaction has commercial Substance   DATE PARTICULAR DEBIT CREDIT         Jan 1,…

Q: Brown Company contracts with Sebastian Company to exchange refrigerated trucks. Brown Company will…

A: An exchange is said to have commercial substance if the risk, timing and amount of cash flows…

Q: Willis Bus Service traded in a used bus for a new one. The original cost of the old bus was $52,000.…

A: The objective of the question is to determine the cash amount Willis Bus Service had to pay to…

Q: A business buys a machine costing £40,000 on 1 January 2017. It expected to keep the machine for 6…

A: Cost of the machine = £ 40000 Useful life = 6 years  Scrap value = £ 10000 Depreciation per year by…

Q: Wanda sold an asset for £10,000. The original cost was £23,000. The asset, which had an estimated…

A: The profit or loss from the disposal of the asset represents the difference between sale amount of…

Q: A company which uses the revaluation model for its PPE bought a building on 1 January 2014 for…

A: According to the provisions of IAS 36 'Impairment of Assets', whenever the carrying amount of an…

Q: A company which uses the revaluation model for its PPE bought a building on 1 January 2014 for…

A: Revaluation loss is the difference between  the carrying amount of the asset and the revalued amount…

Q: Opal, Inc. owns a delivery truck that initially cost $40,000. After a depreciation of $15,000 had…

A: Assets means the resources which is owned by business. Liability means the amount which is to be…

Q: On 1 January 2021, Tymba plc has a building with a carrying value of £500,000 which was purchased on…

A: As per  IAS 16, Property, Plant and Equipment Amount that can be transferred from revaluation…

Q: Keating Co. is considering disposing of equipment that cost $56,000 and has $39,200 of accumulated…

A: Differential analysis :— This analysis shows the comparison between two alternatives.  Net benefit…

Q: Miracle Manufacturing Company Limited (Miracle) has the following transactions relating to its long…

A: The journal entries are prepared to keep the record of day to day transactions of the business.

Q: sed a motor vehicle on 1 January 2014 for £24,000. It had an expected useful  life of 5 years and…

A: Depreciation is a method of accounting that allocates the cost of a tangible or physical asset over…

Q: Lokton plc has a piece of equipment which it bought on 1 January 2014 for £1,000,000. The equipment…

A: The impairment loss is the loss suffered by the company when the fair value of the asset in lower…

Q: Consider two hypothetical companies: A and B. At the beginning of year 1, each company buys an…

A: Annual Depreciation using straight line depreciation :— Under this method of depreciation,…

Q: Caleb Company owns a machine that had cost $46,000 with accumulated depreciation of $20,200. Caleb…

A: The objective of the question is to record the exchange of a machine owned by Caleb Company for a…

Q: Oriole plc purchased a computer for £9.440 on January 1, 2021. Straight-line depreciation is used,…

A: Depreciation :— It is the allocation of depreciable cost of asset over the useful life of asset.…

Consolidation

Consolidation in general examination implies an asset oscillating between well-defined methods of trading status. Consolidation is commonly known as market indecisiveness, which completes when the asset's values move forward or backward the trading structure.