The financial year of Jeremiah Trading CC ends on 30 June. On 1 July 2020 the balances
Question:
The financial year of Jeremiah Trading CC ends on 30 June. On 1 July 2020 the balances in Jeremiah Trading CC ledger included the following.
Vehicles at cost 70 000
Provision for depreciation on vehicles 20 000
The following information is provided.
1. On 1 July 2020, Jeremiah Trading CC bought a vehicle for N$20 000 on credit from Tshegalo Motors.
2. On 1 July 2021 Jeremiah Trading CC purchased another vehicle for N$25 000, paying by Cheque.
3. On 30 September 2021 Jeremiah Trading CC sold an old vehicle for N$5 000, which was paid into the bank. This vehicle cost N$12 000 when purchased on 1 July 2019.
4. Jeremiah Trading CC depreciates her vehicles on cost at 20% per annum on a month- by month basis.
REQUIRED
Prepare the following accounts for the years ended 30 June 2020 and 30 June 2021. Balance the vehicles and provision for depreciation on vehicles accounts and bring down the balance on 1 July 2021.
(i) Vehicles Account
(ii) Provision for Depreciation on Vehicles Account
(iii) Vehicle Disposal Account
Introduction To Financial Accounting
ISBN: 978-0077138448
7th edition
Authors: Anne Marie Ward, Andrew Thomas