Question No 11 Chapter No 12

Question No 11 Chapter No 12

11. A plant is purchased for 60,000 on 1st April 2009. It is estimated that the residual value of this plant at the end of its working life of 10 years will be 20,920. Depreciation is to be provided at 10% p.a. on the diminishing balance method.
You are required to show the Plant Account for 4 years, assuming that the books are closed on 31st March every year.

The solution of Question No 11 Chapter No 12: –

Dr.Plant & Machinery A/cCr.
1st Apr.2106To Bank A/c 60,00031st Mar2017By Deprecation A/c 6,000
    31st Mar2017By Balance C/d 54,000
   60,000   60,000
1st Apr 2017To Balance b/f 54,00031st Mar2018By Deprecation A/c 5,400
    31st Mar2018By Balance C/d
   54,000   54,000
1st Apr 2018To Balance b/f 48,60031stMar2019By Deprecation A/c 4,860
    31stMar2019By Balance C/d 43,730
   48,600   48,600
1st Apr.2019To Balance b/f 43,74031stMar2020By Deprecation A/c 4,374
    31stMar2020By Balance C/d 39,336

Note: When deprecation is charged as per the written down value method, the scrap value of the asset is ignored.

Depreciation | Meaning | Methods | Examples

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

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