Fixed Assets is one of 9 topics in the Grade 11 Accounting CAPS syllabus, covered across 3 lessons on Study Vault. Below are real practice questions from this topic with full worked answers.
Sample practice questions
Easy
1. A fixed asset register is mainly used to:
Track detailed information about each individual fixed asset the business owns
Record only the total sales for the year
Replace the need for a General Ledger
Calculate VAT payable to SARS
Answer: Track detailed information about each individual fixed asset the business owns — A fixed asset register records details for each individual asset (description, cost, depreciation, carrying value), unlike the general ledger, which shows only category totals.
Easy
2. A fixed asset is recorded at cost price, which includes:
The purchase price plus all costs necessarily incurred to get it ready for use, such as delivery and installation
Only the purchase price, excluding any other costs
The expected resale value in five years' time
Only the VAT portion of the purchase
Answer: The purchase price plus all costs necessarily incurred to get it ready for use, such as delivery and installation — Under the historical cost principle, an asset's cost price includes the purchase price plus any costs necessarily incurred to bring it to its intended location and working condition, e.g. delivery and installation.
Medium
3. A business buys a machine for R95 000. Delivery costs R3 500 and installation costs R1 500 to get it ready for use. Calculate the total cost price to be recorded for the machine, in rand.
Answer: 100000 — Cost price = 95000 + 3500 (delivery) + 1500 (installation) = R100 000, since these costs were necessarily incurred to prepare the asset for use.
