Question B1An extract from the Statement of Financial Position for Hannah, a sole trader at 31stDecember 2020 showed the following for Non Current AssetsCost£750,000AccumulatedDepreciation£450,000(c)Net Book Value£300,000Non Current AssetsDuring the financial year ended 31st December 2021 the following transactions tookplace.[1] The sale of a Non Current Asset on 30th June 2021 for £10,000 which cost£120,000 when purchased on January 1st 2017[2] There was a purchase of a Non Current Asset on 1st May 2021 costing £90,000Hannah's depreciation policy is to provide for depreciation on all Non Current Assets ata rate of 20% per annum using the straight line method(a)Required:Prepare an extract from the Statement of Financial Position at 31stDecember 2021 showing the Non Current Assets section only(b) Identify the factors relevant to choosing an appropriate method fordepreciationExplain why it is important to distinguish between Capital and RevenueExpenditure

Assets refer to tangible objects or intangible rights of an enterprise that carry probable future…

(a) Required: Prepare an extract from the Statement of Financial Position at 31st December 2021 showing the Non Current Assets section only (b) Identify the factors relevant to choosing an appropriate method for depreciation (c) Explain why it is important to distinguish between Capital and Revenue Expenditure

(a) Required: Prepare an extract from the Statement of Financial Position at 31st December 2021 showing the Non Current Assets section only (b) Identify the factors relevant to choosing an appropriate method for depreciation (c) Explain why it is important to distinguish between Capital and Revenue Expenditure

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter13: Investments And Long-term Receivables

Section: Chapter Questions

Problem 8P

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