14. A companys policy is to charge depreciation on plant and machinery at 20% per year on...
Question:
14. A company’s policy is to charge depreciation on plant and machinery at 20% per year on cost, with proportional depreciation for items purchased or sold during a year. The company’s plant and machinery at cost account for year ended 30 September 2020 is shown below.
PLANT AND MACHINERY - COST
1 Oct 2012 Balance 200,000
30 Jun 2013 Transfer to disposal account 40,000
1 April 2013 Cash-purchase of plant 50,000
30 Sep 2013 Balance 210,000 250,000 250,000
What should be the depreciation charge for plant and machinery (excluding any
profit or loss on the disposal) for the year ended 30 September 2020?
A. RM 43,000
B. RM 51,000
C. RM 42,000
D. RM 45,000
15. Salaries of RM 5,100 were wrongly posted to the salaries account as RM 1,500.
This is an example of ___________.
A. Error of principle
B. Error of posting
C. Error of commission
D. Compensating error
16. When a transaction is recorded without due regard to the fundamental principles of accounting, it is an example of ________________.
A. Error of omission
B. Error of posting
C. Error of casting
D. Error of principle
17. One-sided errors are corrected via _________.
A. Journal
B. Profit and loss adjustment account
C. Trial balance
D. Suspense account
18. The profit made by a business in 2020 was RM35, 400. The proprietor injected new capital of RM10, 200 during the year and withdrew a monthly salary of RM 500. If net assets at the end of 2020 were RM95, 100, what was the proprietor’s capital at the beginning of the year?
A. RM 50,000
B. RM 55,500
C. RM 63,500
D. RM 134,700
19. Trial Balance might match in spite of presence of _____________.
A. Errors of complete omission and error of principle
B. Error of complete omission
C. Error of commission
D. Error of principle
20. Misstating the information could influence users of the financial statements. Which accounting concept best describe above statement?
A. The qualitative concept
B. The historical concept
C. The materiality concept
D. The going concern concept
21. RM 2,000 received from Smith whose account was previously written off as a bad debt should be credited to ____________.
A. Bad debts recovered account
B. Smith account
C. Cash account
D. None of above
22. A machine with a cost of RM 40,000 and accumulated depreciation of RM 36,500 is sold for RM 5,500. What is the amount of the gain or loss on disposal of the fixed asset?
A. RM 2,500 loss
B. RM 1,000 loss
C. RM 2,000 loss
D. RM 2,000 gain
23. A vehicle with a cost of RM 120,000 has an estimated residual value of RM 8,000 and an estimated life of 7 years. What is the amount of depreciation for the third full year, using the straight line method?
A. RM 21,666
B. RM 18,000
C. RM 18, 720
D. RM 16, 000
24. The estimated value of fixed assets at the time it is to be retired from service is refer to _____________.
A. Net value
B. Residual value
C. Cost value
D. Carrying value
25. Net realizable value of accounts receivable is __________.
A. Accounts receivable plus allowance for doubtful debts
B. The same as accounts receivable because all accounts receivable are
assumed to be collectible
C. Accounts receivable minus allowance for doubtful debts
D. None.
