Accounting Multiple Choice Question – 15 March 2024

On 1 January 2023, Alex Trading Ltd purchased some plant.

The invoice showed

• Cost of plant – £48,000
• Delivery to factory – £400
• One year warranty covering breakdown during – £800
• Total – £49,200

Modifications costing £2,200 were necessary to enable the plant to be installed.

What amount should be capitalised for the plant in the company’s records?

Select ONE answer:

1. £51,400
2. £48,000
3. £50,600
4. £48,400

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 – 48,000 + 400 + 2,200 = 50,600
4. Not correct

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