Annie Lee has a year-end of 31 October. Her depreciation policy for motor vehicles is as follows:

All motor vehicles are depreciated at the rate of 25% using the straight line method A full year's depreciation is charged when an assets is purchases in the first six months of a financial year.

When an asset is purchased in the second six months of the financial year, a half year's depreciation is charged.

There was no residual value expected for the motor vehicles.

The following purchases of motor vehicles were made in the 3 years ended 31 October 2020. All payments were made by cheque..

Date of purchase Asset Cost

1 Nov 2017 Motor vehicle A 20,000

21 Oct 2018 Motor vehicle B 24,000

28 Feb 2019. Motor vehicle c 28,000

11 Nov 2019 Motor vehicle D 32,000

Required:

Prepare the following accounts for the 3 years ended I November 2018, 2019 and 2020.

(a) Motor Vehicle Account.

(b) Motor Vehicle Depreciation Account

(c) Motor Vehicle Provision for Depreciation Account

(d) Show the Balance Sheet extract recording the motor vehicles as at 31 October 2020.

Answer rating: 100% (QA)

DY a motor vehicle AlC Date partiaulars Amt To Bank A 20000 Bank ... View the full answer