Accounting Multiple Choice Question – 11 November 2019

The home of multiple choice questions for all your KS3, KS4 and KS5 Business Studies, Economics and Accounting requirements.

A firm bought a machine for £33,000. lt expects to use the machine for eleven years and then sell it for £11,000. If the firm calculates depreciation by reference to the straight-line method, the annual depreciation charge, in respect of this machine, will be:

Select ONE answer:

  1. £1,000
  2. £2,000
  3. £2,500
  4. £3,000

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple-choice question is suitable for Accounting KS5 classes.

The answer is 2

  1. Not correct
  2. Annual depreciation charge using the straight-line method of depreciation = [(Cost – estimated residual value) / estimated useful economic life] = (£33,000 – £11,000) / 11 = £2,000 p.a
  3. Not correct
  4. Not correct

 

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