1101AFE Final Exam Practice Paper SEM 3

Question 1

Brown Ltd purchased equipment for $280, 000 on 1st July, 2010. It is expected that the equipment will have a residual value of $10, 000 at the end of its’ 3 year useful life (or 100,000 machine hours).
Calculate depreciation expense to the nearest whole dollar.

a. Calculate the depreciation expense, accumulated depreciation and annual carrying amount for each of the 3 years ended 30th June, under the following depreciation methods:
Straight line
Reducing balance (rate = 47%)
Units of production: 36,000 hours 2011; 36,000 hours 2012; 28,000 hours 2013

b. Record the journal entries required for the sale of the above equipment using the SL method if it sold on the 31st December, 2012 for $51,000

Question 2

The following information is provided in order to prepare bank reconciliation for Sing Supplies
Bank Reconciliation 30th Nov
Balance as per bank statement 30th Nov
15,886
Less: Outstanding cheques

199
432

200
163
(595)
Adjusted bank balance 30th Nov

$15,291

Cash (ledger)
Dec 1
Opening balance
15,291
Dec 6 Cheque 201
1,378
4

2,433
10
202
1,020
9

498
13
203
478
11

1,675
14
204
162
14

890
18
205
795
17

361
27
206
86
25

980
30
207
3,692
31

2,410
30
208
907

30 209
262

31 210
2,164
Dec 31
Closing balance
13,594

Dec 31st bank statement shows the following information:
Date
Transaction details
Dr
$
Cr
$
Dec 1
Beginning balance

15,886
Dec 1
EFT – Rent receipt

1,100
5
Deposit

2,433
6
Cheque 200
163

8
Dishonoured cheque
522

9
Cheque 201
1,378

10
Deposit

498
11
Deposit

1,675
13
Cheque 202
1,020

14
Cheque 203
478

15
Deposit

890
15
Cheque 204
162

18
Deposit

361
19
EFT – Insurance payment
979

22
Cheque 205
795

25
Deposit

980
29
Cheque 206
86

31
Bank