Teddy's Pillows has beginning net non-current assets of £480 and ending net non-current assets of £530.Assets valued at £300 were sold during the year.Depreciation was £40.What is the amount of capital spending?
A)£10
B)£50
C)£90
D)£260
E)£390

Question

Quizplus · Accepted Answer

Capital spending = (Ending net non-current assets - Beginning net non-current assets) + Depreciation - Sale of assets
= (£530 - £480) + £40 - £300
= £50 - £300
= -£250 (negative because it represents a cash outflow for the company)
Therefore, the amount of capital spending is £90.

Teddy's Pillows Has Beginning Net Non-Current Assets of £480 and Ending