Question 1: On 1 January 2011, Y Ltd purchased a new machine for $500 000. The estimated scrap value of the machine is $20 000. The machine is depreciated straight -line over its useful life of 6 years. On 31 December 2012, Y Ltd sold the machine for $400 000 to a director of the company. The gain or loss on sale is:
a. Gain on sale $60,000
b. Loss on sale $100,000
c. Loss on sale $80,000
d. There is no gain or loss
Question 2: The following data relates to a company with a single product:
Selling price per unit $200
Variable costs per unit $140
Fixed costs $130 000
The number of units to produce a profit before tax of $50 000 is?
a. 3 000
b. 2 167
c. 900
d. 833