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Question 4 Depreciation is an important factor in reflecting the true value of the assets of a business in the balance sheet. The following balances of the assets of Naidoo Enterprises were reflected in their balance sheet at 28 February 2003. R Motor vehicles (at cost) 52 050 Office equipment (at cost) 19 418 Security alarm systems (at cost) 17 223 The accumulated depreciation reflected in the balance sheet at 28 February 2003 was: 012 R Motor vehicles 12 236 Office equipment 5 879 Security alarm 2 583 The transactions affecting assets and depreciation during the financial year 1 March 1993 to 28 February 1994 were as follows: March 1 Sold old motor vehicle (cost price R5 770 and accumulated depreciation R3 250) to J. Smith for R2 000 cash. April 30 Purchased new vehicle for R35 000 cash. June Purchased a computer for R12 500 cash. July 31 Sold four old typewriters (cost price R1 000 and accumulated depreciation R750) for R200 cash. February 28 Depreciate: Motor vehicles at 20% on the straight-line basis. Office equipment at 15% on the reducing balance. Security alarm at 15% on the reducing balance. 1 Required (a) Journalise the above transactions. (b) Reflect all the transactions, including balances at 28 February 2003, in the ledger of Naidoo Enterprises. [15]

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