Which one of the following would be a fixed asset for a car dealership?

Debtors

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Cash

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Motor vehicles held for resale

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Office equipments

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Solution

The correct option is D
Office equipments

Office equipments would be a fixed asset for a car dealership.

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Q. Purchase of office equipment for cash would cause __________.

Q. Office equipment is a _________ asset for a computer manufacturer company and ________ asset for a company that deals in these equipments.

Bobbie opened a consulting firm and copleted these trannsactions during November, 2005

(a) Invested Rs 4,00,000 cash and office equipment with Rs 1, 50,000 in a business called Bobbie Consulting.

(b) Purchased land and a small building . The land was worth Rs. 1, 50,000 and the building worth Rs 3,50,000. The purchase price was price was paid with Rs 2,00,000 cash and a long term note payable for Rs 8,00,000.

(d) Bobbie transferred title of motor car to the business. The motor car was worth Rs 90,000.

(e) Purchased for Rs 30,000 additional office equipment on credit.

(f) Paid Rs 7,500 salary to the office manager.

(g) Provide services to a client and collected Rs 30,000.

(h) Paid Rs 4,000 for the month's utilities.

(i) Paid supplier created in transaction (c).

(j) Purchase new office equipment by paying Rs 93,000 cash and trading in old equipment with a recorded cost of Rs 7,000.

(k) Completed services of a client for Rs 26,000. This amount is to be paid within 30 days.

(l) Received Rs 19,000 payment from the client created in transaction (k).

(m) Bobbie withdrew Rs 20,000 from the business.

Analyse the above stated transactions and open the following T- accounts

Cash, client, office supplies, motor car, building, land , long term payables, capital , withdrawals, salary, expense and utilies expense.

Bobby opened a consulting firm and completed these transactions during November, 2005:

(a)	Invested Rs 4,00,000 cash and office equipment with Rs 1,50,000 in a business called Bobbie Consulting.
(b)	Purchased land and a small office building. The land was worth Rs 1,50,000 and the building worth Rs 3,50,000. The purchase price was paid with Rs 2,00,000 cash and a long term note payable for Rs 8,00,000.
(c)	Purchased office supplies on credit for Rs 12,000.
(d)	Bobbie transferred title of motor car to the business. The motor car was worth Rs 90,000.
(e)	Purchased for Rs 30,000 additional office equipment on credit.
(f)	Paid Rs 75,00 salary to the office manager.
(g)	Provided services to a client and collected Rs 30,000
(h)	Paid Rs 4,000 for the month’s utilities.
(i)	Paid supplier created in transaction (c).
(j)	Purchase new office equipment by paying Rs 93,000 cash and trading in old equipment with a recorded cost of Rs 7,000.
(k)	Completed services of a client for Rs 26,000. This amount is to be paid within 30 days.
(l)	Received Rs 19,000 payment from the client created in transaction (k).
(m)	Bobby withdrew Rs 20,000 from the business.

Analyse the above stated transactions and open the following T-accounts:

Cash, client, office supplies, motor car, building, land, long term payables, capital, withdrawals, salary, expense and utilities expense.

State which fo the following would result in inflow/outflow of Cash or Cash Equivalents:
(i) Purchase of Inventory for cash.
(ii) Purchase of goods on credit.
(iii) Sale of Goods costing Rs. 10,000 for Rs. 12,000 for cash.
(iv) Sale fo Goods on Credit.
(v) Purchase of a fixed asset by issue of shares.

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Which one of the following would be a fixed asset for a car dealership?

The correct option is D Office equipments Office equipments would be a fixed asset for a car dealership.

The correct option is D
Office equipments

Office equipments would be a fixed asset for a car dealership.