60.1K

Verified Solution

Link Copied!

Question 2 (Duration: 25 minutes; 10.30 a.m. -10.55 a.m.) SAF Sdn Bhd is a company in developing properties around the city of Kuala Lumpur. The company commenced the business in January 2018, On January 1, 2020, the following balances were extracted from the financial statements: Equipment (cost) RM50,000 Motor Vehicle (cost) RM110,000 (inclusive of van RM 70,000 Delivery truck RM40,000) All the plant assets were acquired in 2018 when the business started During 2020, SAF recorded the following transactions: January 15 Purchased an equipment with an invoice price of RM60,000 for cash. The company also had incurred and paid the following expenses associated with purchasing the equipment: Delivery charges (including transit insurance RM500) RM1.600 Installation cost 800 Lubrication before equipment is placed in service 100 Maintenance charges for the first year 250 June 30 Sold the delivery track to Taufiq Associates for RM28.000 cash October 1 Exchanged the old equipment costing RM50,000 for office furniture by signing a RM15,000 note payable. The office furniture's list price was RM35.000 The accountant had adopted full-year depreciation, for assets purchased during the year and none in the year of disposal when deciding on the following policies: Assets Residual value Useful life Depreciation rate and method Motor vehicle RM5,000 5 years Straight-line Equipment 4 years 20% reducing balance Furniture 10 years Straight-line Required: a Prepare the relevant jumal entries to record the transactions above. b. Calculate the total depreciation expenses for the year 2020. (6 marks) (4 marks) Total: 10 markal

Answer & Explanation Solved by verified expert

See Answer