Accounting Multiple Choice Question – 3 March 2024

Alex Trading plc purchases a machine for £15,000 on 1 January 2023.

After incurring transportation costs of £1,300 and spending £2,500 on installing the machine, it breaks down and costs £600 to repair.

Depreciation is charged at 10% per annum.

At what carrying amount will the machine be shown in Alex Trading plc’s statement of financial position at 31 December 2023?

Select ONE answer:

1. £13,500
2. £14,670
3. £16,920
4. £18,800

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 3

1. Not correct
2. Not correct
3. Correct – Cost (15,000 + 1,300 + 2,500) = £18,800 == > Depreciation (10% x £18,800) == > Carrying amount £16,920
4. Not correct

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