Question No 08 Chapter No 13 – USHA Publication 11 Class

Question No 08 Chapter No 13

8. On 1st April 2017, Dalip Pandey purchased a building for Rs 5,00,000. the extension in the building was done at cost of Rs 1,00,000 on 1st January 2019. the building was further extended on 1st July 2019 at cost of Rs 2,00,000
Prepare Building account for the first three years when depreciation is charged @6%p.a. on straight-line method and books are closed on 31st March every year

The solution of Question No 08 Chapter No 13:-

 Dr. Machine A/c Cr. Date Particulars J.F. Amount Date Particulars J.F. Amount 01/01/17 To Cash A/c 5,00,000 31/03/18 By Deprecation A/c 30,000 31/03/18 By Balance C/d 4,70,000 5,00,000 5,00,000 01/03/18 To Balance b/d 4,70,000 31/03/19 By Deprecation A/c*1 31,500 01/01/19 To Cash A/c 1,00,000 31/03/19 By Balance C/d 5,38,500 5,70,000 5,70,000 01/03/19 To Balance b/d 5,38,500 31/03/20 By Deprecation A/c*2 45,000 01/07/19 To Cash A/c 2,00,000 31/03/20 By Balance C/d 6,93,500 7,38,500 7,38,500

 Dr. Depreciation A/c Cr. Date Particulars J.F. Amount Date Particulars J.F. Amount 31/03/18 To Plant A/c 30,000 31/03/18 By Profit & Loss A/c 30,000 30,000 30,000 31/03/19 To Plant A/c 31,500 31/03/19 By Profit & Loss A/c 31,500 31,500 31,500 31/03/20 To Plant A/c 45,000 31/03/20 By Profit & Loss A/c 45,000 45,000 45,000

Working note:-

*1:- Calculation of the amount of Depreciation on furniture for the year 2018-19
Machinery purchased on 1st April 2017
Depreciation = Value of Asset X Rate of Depreciation X Period
Value of Asset = 5,00,000
Rate of Depreciation = 6%
Period = from 01/01/2018 to 31/03/2019 i.e. 12 months
(from the date of purchase/Beginning balance to end of the financial year)
=5,00,000 X6/100 X 12 / 12
Depreciation = 30,000
Machinery purchased on 1st January 2017
Depreciation = Value of Asset X Rate of Depreciation X Period
Value of Asset = 1,00,000
Rate of Depreciation = 6%
Period = from 01/01/2017 to 31/03/2017 i.e.3 months
(from the date of purchase/Beginning balance to end of the financial year)
= 1,00,000 X 6/100 X 3 / 12
Depreciation = 1,500
Total Depreciation for the year = 31,500

*2:- Calculation of amount of Depreciation on furniture for year 2019-20

Machinery purchased on 1st April 2017
Depreciation = Value of Asset X Rate of Depreciation X Period
Value of Asset = 5,00,000
Rate of Depreciation = 6%
Period = from 01/04/2019 to 31/03/2020 i.e. 12 months
(from the date of purchase/Beginning balance to end of the financial year)
=5,00,000 X6/100 X 12 / 12
Depreciation = 30,000
Machinery purchased on 1st January 2017
Depreciation = Value of Asset X Rate of Depreciation X Period
Value of Asset = 1,00,000
Rate of Depreciation = 6%
Period = from 01/04/2019 to 31/03/2020 i.e.12 months
(from the date of purchase/Beginning balance to end of the financial year)
= 1,00,000 X 6/100 X 6 / 12
Depreciation = 6,000
Machinery purchased on 1st July 2019
Depreciation = Value of Asset X Rate of Depreciation X Period
Value of Asset = 2,00,000
Rate of Depreciation = 6%
Period = from 01/07/2019 to 31/03/2020 i.e.9 months
(from the date of purchase/Beginning balance to end of the financial year)
=2,00,000 X6/100 X 9 / 12
Depreciation = 9,000
Total Depreciation for the year = 45,000

Depreciation | Meaning | Methods | Examples

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

Chapter No. 1 – Introduction

Chapter No. 2 – Theory Base of Accounting

Chapter No. 3 – Vouchers and transactions

Chapter No. 4 – Journal

Chapter No. 5 – Ledger

Chapter No. 6 – Cash Book

Chapter No. 7 – Other Subsidiary Books

Chapter No. 8 – Journal Proper

Chapter No. 9 – Trial Balance

Chapter No. 10 – Bank Reconciliation Statement

Chapter No. 11 – Depreciation

Chapter No. 12 – Provisions and Reserves

Chapter No. 13 – Bills of Exchange

Chapter No. 14 – Rectification of Errors

Chapter No. 15 – Financial Statements – (Without Adjustments)

Chapter No. 16 – Financial Statements – (With Adjustments)