4A company’s policy as regards depreciation of its plant and machinery is to charge depreciation at 20 per cent per year on cost, with proportional depreciation for items purchased or sold during a year.
The company’s plant and machinery at cost account for the year ended 30 September 2003 is shown below:
Plant and machinery – cost 2002$2003$
1 OctBalance (all plant purchased200,00030 Jun Transfer disposal account40,000 after 1999)
2003
1 AprCash-purchase of plant50,00030 Sept Balance210,000
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250,000250,000
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What should be the depreciation charge for plant and machinery (excluding any profit or loss on the disposal) for the year ended 30 September 2003?
A$43,000
B$51,000
C$42,000
D$45,000
5A company’s trial balance failed to agree, the totals being:
Debit$815,602
Credit$808,420
Which one of the following errors could fully account for the difference?
AThe omission from the trial balance of the balance on the insurance expense account $7,182 debit
BDiscount allowed $3,591 debited in error to the discount received account
CNo entries made in the records for cash sales totalling $7,182
DThe returns outwards total of $3,591 was included in the trial balance as a debit balance
[P.T.O.
6The following control account has been prepared by a trainee accountant:
Receivables ledger control account
$$
Opening balance308,600Cash received from credit customers147,200
Credit sales154,200Discounts allowed to credit customers1,400
Cash sales88,100
Contras against credit balances in
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