Day: March 5, 2024

Alex Trading plc purchased a van on 1 October 2023 for a total cost of £22,000 by paying £17,500 cash

and trading in an old van.

The old van had cost £20,000 and the related accumulated depreciation was £14,200.

The loss on disposal in Alex Trading plc’s income statement for the year ended 31 December 2023 is?

Select ONE answer:

1. £1,300
2. £2,000
3. £2,500
4. £5,800

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 1

1. Correct – Cost £20,000 – Depreciation £14,200 – Trade in Allowance (£22,000 – £17,500) = Loss of £1,300
2. Not correct
3. Not correct
4. Not correct

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