A business with a 31 December financial year-end, purchased equipment on 1 June for R50 000 which is to be depreciated at 20% p.a. using the straight line method. What amount of depreciation will be charged at the end of the first year it was purchased?
Select one:
a.
R5 000
b.
R5 833
c.
R29 167
d.
R10 000
Question 2
Question text
Company A paid the following amounts on the vehicle that was bought on 1 February 2023:
- Purchase price of the vehicle was R120 000
- Oil and Petrol to keep the vehicle on the road was R200
- Annual licensing cost for the vehicle was R320
- The cost of fitting a tow bar on the vehicle R2 000
The purchase cost of this vehicle recorded in the vehicle’s account at 1 February 2023 would be:
Select one:
a.
R122 000
b.
R120 000
c.
R120 520
d.
R122 520
Question 3
Question text
The depreciation method which allocates the cost of the asset to depreciation expense evenly over the useful life of the asset is called the……
Select one:
a.
Reducing balance method
b.
Percentage of carrying amount method
c.
Straight line method
d.
Diminishing balance method