Question No 03 Chapter No 12

Question No 03 Chapter No 12

03. Chandra Ltd. purchased a second-hand machine for 8,000 plus CGST and SGST @ 6% each on 1st July, 2015. They spent 3,500 on its overhaul and installation.
Depreciation is written off 10% p.a. on the original cost. On 30th September, 2018, the machine was found to be unsuitable and sold for 6,500. Prepare the Machinery A/c for four years assuming that accounts are closed on 31st March

The solution of Question No 03 Chapter No 12: –

Dr.Machinery A/cCr.
DateParticulars
J.F.AmountDateParticulars
J.F.Amount
1st Jul.2015To Bank A/c (8,000 + 3,500) 11,50031st Mar2016By Deprecation A/c 863
    31st Mar2016By Balance C/d 10,637
   11,500   11,500
1st Apr 2016To Balance b/f 10,63731st Mar2017By Deprecation A/c 1,150
    31st Mar2017By Balance C/d
 9,487
   10,637   10,637
1st Apr 2017To Balance b/f 9,48731st Mar2018By Deprecation A/c 1,150
    31st Mar2018By Balance C/d 8,337
   9,487   9,487
1st Apr.2018To Balance b/f 8,33730thSep 2019By Deprecation A/c 575
    30thSep 2019By Bank A/c 6,500
    30thSep 2019By Profit & Loss A/c 1,262
   8,337
   8,337

Working Note:
Calculation of Depreciation

Statement Showing profit or loss on the sale of Machinery
Particulars
Amount
Purchase value of Equipment as of 1st Jul 201550,000
Less: – Amount of Depreciation charged on the year 2015-16 
11,500 *10%* 9/12863
Amount of Depreciation charged on the year 2016-17 
11,500 *10%* 12/121,150
Amount of Depreciation charged on the year 2017-18 
11,500 *10%* 12/121,150
Amount of Depreciation charged on the year 2018-19 
11,500 *10%* 6/12575
Book value of an asset as on 30th Sep , 20197,762
Sale Price of Machinery 6,500
Loss on the sale of the asset1,262

Depreciation | Meaning | Methods | Examples

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D K Goel – New ISC Accountancy -(Class 11 – ICSE)- Solution

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ISC Accounts 11 20 Image min 197x300 - Question No 03 Chapter No 12 - D.K Goal 11 Class
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