Depreciation
Calculate the carrying value:
Office Equipment at Cost $80,000
Accumulated depreciation start of year $12,000
Depreciation on office equipment $2,000
What is $ 66 000?
What type of account is Accrued expenses?
What is Current Liability?
Give the journal debits and credits for: Insurance paid in advance: $1 240 excluding GST.
What is debit - prepayment $ 1240
credit - Insurance $ 1240?
This principle refers to the fact that a company is to be treated separately from the individual. It is a juristic person.
What is Economic/business entity?
Which financial statements uses the equation Assets - Liabilities = Equity
What is Statement of Financial Position/Balance Sheet?
Vehicles of $ 55,000 depreciated at 12%p.a Straight line method
What is $ 6 600?
Insurance of $ 800 has been paid in advance. Which account is created?
What is Prepayment?
Give the journal debits and credits for: An invoice on hand for advertising is yet to be recorded. The invoice totals $621 including GST.
What is Debit - advertising $ 540, GST $81
Credit - Accounts payable $ 621
Only Assets and liabilities which have a monetary value can be included in the Balance sheet. They must be in the same currency so they can be measured at fair value.
What is money measurement?
Which financial Statement uses the equation Receipts - Payments = Surplus/Deficit
Cash budget/Cash Flow Statement
Buildings of $ 550,000 with Accumulated depreciation of $ 45,000 depreciated at 15%p.a. Diminished value method.
What is $ 75 750?
You calculate that you have received $ 400 for “Service Fees” for next year. What are the debit and credit accounts?
What is Debit - Service Fees Received
Credit - Income received in advance?
Give the journal debits and credits for: Bad debts to be written off: $989 including GST
What is debit bad debts $860, GST $ 129
credit Accounts Receivable $ 989
key accounting principle which makes sure that assets and income are not overstated and provision is made for all known expenses and losses whether the amount is known for certain or just an estimation i.e expenses and liabilities are not understated in the books of accounting. Always think lowest asset value, highest liability value.
What is Prudence?
List 3 types of Assets recorded in the Balance sheet
Non - Current, Current, Intangible
New vehicle bought for $ 45,000 depreciated at 8% per annum diminished balance method. What is the depreciation amount in year 3?
What is $ 3 047.04?
You pay council rates every 3 months in arrears ($1200). At the end of the year you are still owing 2 months rates. Which account and for how much do you debit?
What is Debit Council Rates - $ 800?
Give the journal debits and credits for: The allowance for doubtful debts to be created (for the first time) at 2.5%
what is debit doubtful debts credit allowance for doubtful debts
The ability to compare this year’s financial information to the previous year or to similar industry financial reports to make decisions about improvements that can be made for the company.
What is comparability?
Give the formula for calculating the Property Plant and Equipment value in the main body of the Balance sheet
Cost - Accumulated Depreciation = Carrying Value
Vehicle of $ 60,000 expected to have a useful life of 300,000km. Drove 80,000 this year…what is the depreciation amount?
What is $ 16 000?
Year end runs from 1 July to 30 June. Advertising of $ 3,000 for the next 12 months was paid on 30 November last year. Calculate the value of the prepayment on 30 June.
What is $ 1250?
Give the journal debits and credits for:Depreciation on repair equipment 15% p.a. diminishing value method.
what is debit depreciation
credit accumulated depreciation?
Only transactions that take place in the reporting period are accounted for in that reporting period.
What is the Accrual principle/Matching principle?
How do you calculate the value of the Accounts Receivable in the balance sheet?
Accounts Receivable - Allowance for doubtful Debts = Accounts Receivable