A company maintains its fixed assets at cost. Accumulated provision for depreciation accounts are kept for each asset.

At 31 December 20X8 the position was as follows:

The following transactions were made in the year ended 31 December 20X9:

(a) Purchased – machinery £2,480 and office furniture £320

(b) Sold machinery which had cost £2,800 in 20X5 for £800

Depreciation is charged, on a straight line basis, at 10% on machinery and at 5% on office furniture on the basis of assets in use at the end of the year irrespective of the date of purchase.

Required:

Show the asset and accumulated provision for depreciation accounts for the year 31 December 20X9 and the relevant balance sheet entries at that date.

Transcribed Image Text:

Machinery Office furniture Total Cost To Date Total Depreciation To Date £ £ 25,670 52,950 2,860 1,490