QUESTION ONE

The following balances were included in the statement of financial position of Big Movers Limited as at

1st

July 2011

Cost

Shs.000

Accumulated

Depreciationsh.000

Net book value

Sh.000

Land40,000-40,000

Buildings22,0008,00014,000

Plant and Machinery16,0006,00010,000

Motor vehicles6,0002,0004,000

During the year ended 30 June 2012,the following transactions took place

1.On 1 Jan 2012,a plant that had cost sh. 3,000,000 and had a cumulative depreciation of 2,300,000

as at 30th

June 2011 was sold for sh. 500,000.Anew plant was then purchased at a cost of sh.

4,000,000.

2.On 1 Jan 2012, a professional valuer was engaged and the buildings were re-valued at Sh.

30,000,000

3.On 1st

April 2012, a motor vehicle was purchased at. Sh.300, 000.part of the purchase price was

settled by exchanging another motor vehicle at an agreed value of sh.120, 000 and the balance

paid for in cash. The trade in vehicle had cost sh.200,000 and had a net book value of sh.100,000

as at 30th

June 2011

The company charges depreciation at the following rates

AssetRate per annum

Land-

Buildings2% on cost

Plant and Machinery15% on cost

Motor vehicles20% on cost

A proportionate charge is made in the year of purchase, sale or revaluation of an asset.

Required

1)Buildings account

2)Provision for depreciation on buildings account

3)Plant and Machinery account

4)Provision for depreciation on Plant and Machinery account

5)Motor vehicles account

6)Provision for depreciation on Motor vehicles account

7)Property Plant and equipment movement schedule for the year ended 30th

June2012