(a) Jacob commenced business on 1 January 2019 and acquired plant and machinery as follows:

1 April 2019 £704,000 1 August 2019 £388,000

Jacob’s accounting policy is to charge a full years’ depreciation in the year of acquisition.

1. (i) Compute the depreciation charges for the first accounting year ended 31 December 2020, on each of the following bases:

   • Straight line over five years

   • Reducing balance at 25% on the net book value at each year end.

0. (b) The entries in a receivables ledger control account are:

   Sales £750,900

1. Bank £420,600

   Cash £5,200
   Returns £22,300
   Bad debts £14,000
   Returned unpaid cheque £10,760

2. Contra purchase ledger account £12,480

   Required:

Calculate the balance on the receivables ledger control account.

Answer rating: 100% (QA)

Part a Straight line over five years 1 April 2019 704000 1 Augus... View the full answer