Accounting Treatmen

FA – Nov 2023 – L1 – SA – Q17 – Accounting for Property, Plant, and Equipment (IAS 16)

Describe the treatment of asset and accumulated depreciation accounts upon disposal.

Question

When a non-current asset is disposed of, what is the typical situation regarding the asset account and the accumulated depreciation account in the general ledger?

A. Both the asset account and the accumulated depreciation account will be closed to zero
B. The asset account will have a closing balance, but the accumulated depreciation account will be closed to zero
C. The asset account will be closed to zero, but the accumulated depreciation account will have a closing balance
D. Both the asset account and the accumulated depreciation account will have closing balances to carry forward
E. Neither the asset account nor the accumulated depreciation account will have a zero closing balance

Answer

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Tags: Accounting Treatmen, Disposal, Non-current Assets

Topic: Accounting for Property, Plant, and Equipment (PPE) IAS 16
Series: NOV 2023

Question Tag: Accounting Treatmen

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FA – Nov 2023 – L1 – SA – Q17 – Accounting for Property, Plant, and Equipment (IAS 16)

Describe the treatment of asset and accumulated depreciation accounts upon disposal.

FA – Nov 2023 – L1 – SA – Q17 – Accounting for Property, Plant, and Equipment (IAS 16)

Describe the treatment of asset and accumulated depreciation accounts upon disposal.

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FA – Nov 2023 – L1 – SA – Q17 – Accounting for Property, Plant, and Equipment (IAS 16)

Describe the treatment of asset and accumulated depreciation accounts upon disposal.

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FA – Nov 2023 – L1 – SA – Q17 – Accounting for Property, Plant, and Equipment (IAS 16)

Describe the treatment of asset and accumulated depreciation accounts upon disposal.

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