JAMB Principles of Accounts 2003 Question 12

Use the information below to answer questions 12 and 13.
Motor Vehicle Account as at 31st December, 2001 (₦)
Debit:
Jan. 1, cost 1 950 000
Dec. 31, Addition 400 000
Credit:
Jan. 1, Depreciation 1 360 000
June 30, Sales proceeds 700 000
The vehicle sold was purchased on January 1, 1998 at a cost of ₦1,000 000 and had depreciated at 25% on cost.
Assuming that depreciation is charged on the addition of the year at the rate of 15% on reducing balance, what should be the net book value of the vehicle as at 31st December 2003?

1. A.₦111 000
2. B.₦280 000
3. C.₦289 000
4. D.₦340 000