Non-current tangible assets–depreciation

7.9 A company’s policy is to charge depreciation on plant and machinery at 20% per year on cost, with
proportional depreciation for items purchased or sold during a year.

The company’s plant and machinery at cost account for the year ended 30 September 20X3 is shown
below.

PLANT AND MACHINERY – COST

$ $
20X2 20X3
1 Oct Balance 200,000 30 Jun Transfer disposal account 40,000
30 Sep Balance 210,000
20X3
1 Apr Cash-purchase of plant 50,000
250,000 250,000

What should be the depreciation charge for plant and machinery (excluding any profit or loss on the
disposal) for the year ended 30 September 20X3?

A $43,000
B $51,000
C $42,000
D $45,000 (2 marks)
Dear All:
Please help and explain to me how to figure out this question???
I don’t understand why I need to depreciate the transfer disposal account? What does it acutally mean? Is it debit disposal account? Disposal of assets?
Thanks!