A business bought a motor vehicle for 16,800 on 1 January 2023, paying in full immediately by

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A business bought a motor vehicle for £16,800 on 1 January 2023, paying in full immediately by bank transfer. Financial statements are prepared annually to 31 December and depreciation of vehicles is charged at 25% per year under the reducing balance method.

Required:

Prepare the motor vehicles at cost account and the accumulated depreciation account for the first two years of the motor vehicle’s working life.

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