On 1 January 2015, Mikail bought a car from Carz Enterprise on hire purchase. The details...

  

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On 1 January 2015, Mikail bought a car from Carz Enterprise on hire purchase. The details of the hire purchase agreement were as follows: Cash price: Deposit: Installments: First installment due: Interest charged: RM60,000 RM5,000 Half yearly installment RM10,000 for the first 5 installment and RM17,000 for the last installment 30 June 2015 Flat rate All installment were paid on due dates. After third installment on 1 July 2016, the car was involved in an accidence and permanently damage. Mikail received insurance of RM 45,000. Besides that, Carz enterprise agreed to give a 30% rebate of finance cost due to termination of hire purchase agreement. Mikail prepared their account annually every 31 December. The estimated useful life of the car is 5 years (20% on cost), with no residual value and yearly basis. Required: A. Show the calculation of the interests per installment. (6 marks) B. Calculate the amount of final payment. (6 marks) C. Prepare the following account for the year ended 31 December 2015 and 2016 in the book of Mikail: 1. Hire Purchase Payable II. Car account III. IV. Accumulated Depreciation - Car Disposal account. (13 marks) [25 marks] On 1 January 2015, Mikail bought a car from Carz Enterprise on hire purchase. The details of the hire purchase agreement were as follows: Cash price: Deposit: Installments: First installment due: Interest charged: RM60,000 RM5,000 Half yearly installment RM10,000 for the first 5 installment and RM17,000 for the last installment 30 June 2015 Flat rate All installment were paid on due dates. After third installment on 1 July 2016, the car was involved in an accidence and permanently damage. Mikail received insurance of RM 45,000. Besides that, Carz enterprise agreed to give a 30% rebate of finance cost due to termination of hire purchase agreement. Mikail prepared their account annually every 31 December. The estimated useful life of the car is 5 years (20% on cost), with no residual value and yearly basis. Required: A. Show the calculation of the interests per installment. (6 marks) B. Calculate the amount of final payment. (6 marks) C. Prepare the following account for the year ended 31 December 2015 and 2016 in the book of Mikail: 1. Hire Purchase Payable II. Car account III. IV. Accumulated Depreciation - Car Disposal account. (13 marks) [25 marks]

Answer rating: 100% (QA)

A Calculation of interest per installment Total cash price RM60000 Deposit RM5000 Amount financed RM... View the full answer