Sarah Glass Practice exam unit 5
yorkshirelass
Registered Posts: 17 New contributor 🐸
Hi
i was wondering if anyone has done this practice exam in osbourne books, ive always struggled with depreciation and question 1.6 asks me to show the net book value of the fixed assets held at 30th april 2004
these are the figures we are given
Freeholdd premises at cost £104,000
Less Depreciation to date £20,800
Fixtures and fittings at cost £22,750
Less Depreciation to date £13,650
Premises are to be depreciated at 2% per annum on cost and
Fixtures and fittings at 10% per annum on cost
so this is what i have worked out
Fixed Assets Cost £ Provision for depn £ Net £
Premises 104,000 20,800 83,200
Fixtures and Fittings 22,750 13,650 9,100
so would the netbook value of the fixed assets be £92,300 (83,200+9,100)?
thanks
i was wondering if anyone has done this practice exam in osbourne books, ive always struggled with depreciation and question 1.6 asks me to show the net book value of the fixed assets held at 30th april 2004
these are the figures we are given
Freeholdd premises at cost £104,000
Less Depreciation to date £20,800
Fixtures and fittings at cost £22,750
Less Depreciation to date £13,650
Premises are to be depreciated at 2% per annum on cost and
Fixtures and fittings at 10% per annum on cost
so this is what i have worked out
Fixed Assets Cost £ Provision for depn £ Net £
Premises 104,000 20,800 83,200
Fixtures and Fittings 22,750 13,650 9,100
so would the netbook value of the fixed assets be £92,300 (83,200+9,100)?
thanks
0
Comments

Looks good to me, but are the given figures for the year ending 30th April 2004 or do you still need to calculate the depreciation for the year?0

no, the given figures are for 30th April 2003, so would my answer below be correct then?
thanks0 
Hi,
In that case you will need to calculate one year of depreciation and add that to the depreciation you already calculated.
The depreciation amounts can be found by looking at these two lines:yorkshirelass wrote: »Premises are to be depreciated at 2% per annum on cost and
Fixtures and fittings at 10% per annum on cost
The cost of the fixed asset is the original value the company paid when they purchased the asset.
The provision for depreciation is the total of depreciation of all previous years and at year end, including this years depreciation.
The net book value is the amount the asset is worth now to the company, so that is the original cost minus depreciation to date.
Does this help?
Cheers,
Rinske0 
Hi
I think i understand as follows
In 2003
The original cost of premises is £104,000
and depreciation for year is 20,800 (2%)
so in 2004 the total depreciation is £41,600
so net book value at 30 April 2004 is £104,000 minus £41,600 equals £62,400
is that correct?0 
sorry
i just been reading over my answers again and i have realised my mistake
im pretty sure now that this is what the answer should be
Freehold premises as cost £104,000
Depreciation to date £22,880 (20,800 + (2% * 104,000)
Net £81,120
Fixtures and Fittings at cost £22,750
Depreciation to date £15,925 (13,650 = (10%*22,750)
Net £ 6,825
Total Net Value = £87,945 (81,120+6,825)
hope this is right now ?
thanks0 
Hi,
That looks alright to me!
Cheers,
Rinske0
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