Accounts - Principles of Accounts Past Questions and Answers

Which of the following may cause depreciation? i. wear and tear ii. obsolescence and passage of time iii. fluctuation

A I, ii and iii
B I and ii
C I and iii
D Ii and iii
E Iii

Question 27:

A machine cost N12,000 and has a useful life of 4 years and an expected disposal value of N400. Using the straight line method, the annual depreciation is

A N3,100
B N3,000
C N2,900
D N2,300
E N2,000

Question 28:

A machine cost N12,000 and has a useful life of 4 years and an expected disposal value of N400.Using the reducing balance method what will be the depreciation charge for year 2 at 20%? (ignoring residual value)

A N3,000
B N2,900
C N2,400
D N1,920
E N1,536

Question 29:

A machine cost N12,000 and has a useful life of 4 years and an expected disposal value of N400. Using the reducing balance method, what us the net book value at the end of the year 2? (ignoring residual value)

A N10,480
B N10,080
C N9,680
D N9,600
E N7,680

Question 30:

A machine cost N12,000 and has a useful life of 4 years and an expected disposal value of N400. The accumulated depreciation at the end of the year 3 using the straight line method is

A N9,300
B N9,000
C N8,700
D N6,900
E N6,000