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Depreciation and Revaluation of Fixed Assets The following details were taken from the books of Clinton Ltd: 01/01/2015 Buildings at cost amounted to €650,000 - Leaving Cert Accounting - Question 2 - 2017
Question 2
Depreciation and Revaluation of Fixed Assets The following details were taken from the books of Clinton Ltd: 01/01/2015 Buildings at cost amounted to €650,000. 01... show full transcript
Worked Solution & Example Answer:Depreciation and Revaluation of Fixed Assets The following details were taken from the books of Clinton Ltd: 01/01/2015 Buildings at cost amounted to €650,000 - Leaving Cert Accounting - Question 2 - 2017
Step 1
The buildings account for the two years 2015 and 2016.
Answer
The Buildings Account should be prepared showing all transactions related to buildings over the specified period.
| Date | Details | € | Balance | € | |
|---|---|---|---|---|---|
| 01/01/2015 | Balance b/d | 650,000 | 650,000 | ||
| 01/06/2015 | Bank | 120,000 | 770,000 | ||
| 01/07/2015 | Disposal | 100,000 | 670,000 | ||
| 31/12/2015 | Balance c/d | 670,000 | |||
| 01/01/2016 | Revaluation | 80,000 | 750,000 | ||
| 31/12/2016 | Balance c/d | 750,000 |
Step 2
The provision for depreciation account for the two years 2015 and 2016.
Answer
The Provision for Depreciation Account should detail the amount of depreciation charged each year.
| Date | Details | € | Balance | € | |
|---|---|---|---|---|---|
| 01/01/2015 | Balance b/d | 56,000 | 56,000 | ||
| 01/07/2015 | Disposal | 40,000 | 16,000 | ||
| 31/12/2015 | P & L Dep. | 32,000 | 48,000 | ||
| 31/12/2016 | P & L Dep. | 22,500 | 70,500 | ||
| 01/01/2017 | Balance c/d | 22,500 |
Step 3
Step 4