CIMA Exam CIMAPRA19-F01-1 Topic 3 Question 48 Discussion

Actual exam question for CIMA's CIMAPRA19-F01-1 exam

Question #: 48
Topic #: 3

ST has $20,000 of plant and machinery which was acquired on 1 April 20X0. Tax depreciation rates on plant and machinery are 20% reducing balance. All plant and machinery was sold for $12,000 on 1 April 20X2.

Calculate the tax balancing allowance or charge on disposal for the year ended 31 March 20X3 and state the effect on the taxable profit.

AA balancing allowance of $800 will increase taxable profits.

BA balancing allowance of $800 will reduce taxable profits.

CA balancing charge of $800 will increase taxable profits.

DA balancing charge of $800 will reduce taxable profits.

Show Suggested Answer

Suggested Answer: B

by Valentin at May 07, 2022, 05:37 PM

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