Prepare the office equipment account

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Reference no: EM132985851

Question: J.S. Ltd. trades electronic parts and commenced business on 1 April 2014. It has a period-end on March 31.

A computer was bought on 1 January 2015 for $8,000. It was estimated to have a scrap value of $500 and 4 years useful life. On 1 January 2017, the computer was traded in for a new computer of updated version which costs $12,000. The trade-in value of the old computer was $1,000 and the balance was paid by cheque.

Depreciation was charged on office equipment at 20% p.a. on book value. No depreciation is charged in the year of purchase of non-current assets while a full-year depreciation is charged in the year of disposal.

Purchases of other office equipment during these years were as follows ( all paid by cash ) :

Printer ( bought on 1 September 2014 ) 2,000

Photocopier ( bought on 1 July 2015 ) 6,000

No residual value was expected from the above two office equipment.

Prepare the following for the year ended 31 March 2017:

(a) Office equipment account

(b) Accumulated depreciation of office equipment

Reference no: EM132985851

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