A) Nauman Afzal bought three motorcars during 2010 as follows Car XYZ, on 1 January for Rs.500,
Question:
A) Nauman Afzal bought three motorcars during 2010 as follows
Car XYZ, on 1 January for Rs.500, 000
Car SDA, on 1 April for Rs.600, 000
Car CVS, on 1 July for Rs.480, 000
She closes her books on 30 September each year and provides 20% p.a depreciation on book value on all motorcars. On 1 October 2011 he sold car XYZ for Rs. 300,000. On 1 January 2012 she traded in car SDA, at Rs. 390000 for another car CVS that cost Rs.800, 000, meeting the difference in cash.
Show the motorcars account, depreciation expense account, provision for depreciation on motorcars and disposal of assets account, in her ledger, balanced each year on 30 September, till 30 September 2012
B) Why financial statements are prepared? Answer your question in light of agency theory offinance?How man ymethods of Depreciation are there and in which situation which method is selected?
Expert Answer:
Motor Cars Ac Date Particulars Rs Date Particulars Rs 2010 2010 Jan 1 To Bank CarXYZ 500000 Sep 30 By Balance cd 1580000 Apr 1 To Bank CarSDA 600000 Jul 1 To Bank CarCVS 480000 1580000 1580000 2010 20... View the full answer
Horngrens Accounting
ISBN: 978-0133855371
10th Canadian edition Volume 1
Authors: Tracie L. Miller-Nobles, Brenda L. Mattison, Ella Mae Matsumura, Carol A. Meissner, Jo-Ann L. Johnston, Peter R. Norwood
