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On the First Day of the Financial Year Merv's Boats

Question 3

Multiple Choice

On the first day of the financial year Merv's Boats purchased a truck for $16 000. The truck is to be depreciated by 25% each year and has a zero residual value. At the end of the first year the adjusting entry to record depreciation on the truck is:


A) DR Depreciation - Truck $4000; CR Truck $4000
B) DR Depreciation - Truck $12000; CR Accumulated depreciation - Truck $12000
C) DR Accumulated depreciation - Truck $4000; CR Depreciation - Truck 4000
D) DR Depreciation - Truck $4000; CR Accumulated depreciation - Truck $4000

Correct Answer:

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