Question 32 Chapter 1 of +2-A - T.S. Grewal 12 Class Part

Question 32 Chapter 1 of +2-A

Table of Contents

The solution of Question 32 Chapter 1 of +2-A: –

T.S. Grewal’s Double Entry Book Keeping +2 (Vol. I: Accounting for Not-for-Profit Organizations and Partnership Firms)

T.S. Grewal’s Double Entry Book Keeping (Vol. II: Accounting for Companies)

32. Delhi Youth Club has furniture at a value of Rs. 2,20,000 in its book on 31st March 2018. It sold old furniture, having a book value of Rs. 20,000 as at 1st April 2018 at a loss of 20% on 31st December 2018. Furniture is to be depreciation @ 10% p.a. Furniture costing Rs. 1,50,000 was also purchased on 1st October 2018.
Prepare Furniture Account for the year ended 31st March 2019.

The solution of Question 32 Chapter 1 of +2-A: –

	Furniture A/c
Date	Particular	Amount	Date	Particular	Amount
01/04/18	To Balance b/d	2,20,000	30/09/18	By Depreciation a/c (on a sold part) see note	1,500
01/10/18	To Bank A/c	1,50,000	30/09/18	By Cash a/c	14,800
			30/09/18	By loss on the sale of Furniture	3,700
			31/03/19	By Depreciation a/c (on balance) see note	27,500
			31/03/19	By Balance c/d (B. Fig.)	3,22,500
		3,70,000			3,70,000

Income and Expenditure Account
Expenditure	Amount	Income	Amount
To Loss on sale of Furniture (check working note)	3,700
To Depreciation a/c (1500 + 20,000 + 7,500)	29,000

BALANCE SHEET (AN EXTRACT) as on 31st March 2019
Particular	Amount	Particular	Amount
		Furniture	3,22,500

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Statement Showing stationery used during the year
Particular	Amount
Book value of furniture as on 1st April, 2018 which is sold	20,000
Less: – Amount of Depreciation up to the date of sale i.e. 31st December 2018
30,000 * 10% *9/12	1,500
Book value of furniture as on 30th September 2018	18,500
Less: – Loss on sale of assets @ 20% 18,500 * 20%	3,700
Sale Price of furniture	14,800

Calculation of the amount of Depreciation on Balance of Furniture: –

On Old Furniture Full-year dep. Charged	On New Furniture From the Date of Purchase i.e. 01st October 2019 (For 6 months)
2,00,000 x 10% = 20,000/-	1,50,000 x 10% x 6/12 = 7,500/-

Total Amount of Dep = 27,500