Which of the following options best describes the carrying amount of an asset (vehicle)?
Understand the Problem
The question is asking which option best describes the carrying amount of an asset, specifically in relation to a vehicle and its depreciation. It requires understanding the concepts of asset valuation and depreciation.
Answer
The vehicle was bought for R100,000 with R70,000 depreciation, valuing it at R30,000.
The option stating a vehicle was bought for R100,000 and has accumulated depreciation of R70,000, resulting in a value of R30,000.
Answer for screen readers
The option stating a vehicle was bought for R100,000 and has accumulated depreciation of R70,000, resulting in a value of R30,000.
More Information
The carrying amount of an asset is its original cost minus any accumulated depreciation. This value reflects the current book value on financial statements.
Tips
Confusing the carrying amount with concepts like fair value or trade-in value. Make sure to focus on cost minus accumulated depreciation.
Sources
- Carrying Value: Definition, Formulas, and Example - Investopedia - investopedia.com
- Which of the following options best describes the carrying ... - Studocu - studocu.com
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