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/c Cr. Date Particulars J.F. Amount Date Particulars J.F. Amount 1st Jul.2015 To Bank A/c (8,000 + 3,500) 11,500 31st Mar2016 By Deprecation A/c 863 31st Mar2016 By Balance C/d 10,637 11,500 11,500 1st Apr 2016 To Balance b/f 10,637 31st Mar2017 By Deprecation A/c 1,150 31st Mar2017 By Balance C/d 9,487 10,637 10,637 1st Apr 2017 To Balance b/f 9,487 31st Mar2018 By Deprecation A/c 1,150 31st Mar2018 By Balance C/d 8,337 9,487 9,487 1st Apr.2018 To Balance b/f 8,337 30thSep 2019 By Deprecation A/c 575 30thSep 2019 By Bank A/c 6,500 30thSep 2019 By 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 2015 50,000 Less: – Amount of Depreciation charged on the year 2015-16 11,500 *10%* 9/12 863 Amount of Depreciation charged on the year 2016-17 11,500 *10%* 12/12 1,150 Amount of Depreciation charged on the year 2017-18 11,500 *10%* 12/12 1,150 Amount of Depreciation charged on the year 2018-19 11,500 *10%* 6/12 575 Book value of an asset as on 30th Sep , 2019 7,762 Sale Price of Machinery 6,500 Loss on the sale of the asset 1,262

Depreciation | Meaning | Methods | Examples

Comment if you have any question.

Also, Check out the solved question of all Chapters: –

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

Check out the Accountancy Class +1 by D.K. Goal (Arya Publication) from their official Site.