Accounting Multiple Choice Question – 23 March 2024

Alex plc bought a car on 1 January 2017 for £10,000 and decided to depreciate it at 30% per annum on a reducing balance basis.

It was disposed of on 1 January 2019 for £6,000.

The net effect on the income statement for the year ended 31 December 2019 is a credit of?

Select ONE answer:

1. £1,100
2. £3,000
3. £4,000
4. £5,100

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 – (£10,000 x 70% x 70%) – £6,000 = £1,100
2. Not correct
3. Not correct
4. Not correct

This work is licensed under a Creative Commons Attribution 4.0 International License.