Question No 11 Chapter No 13 – USHA Publication 11 Class

Question No 11 Chapter No 13

Question No 11 Chapter No 13

Sale of Total Assets

11. Balwant Gargi purchased one building at a cost of Rs 12,00,000 on 1st July 2016. the building was depreciated @10% p.a. on fixed instalment method. On 31st March 2019, the building was sold for Rs 17,00,000
Prepare Machinery Account for the first four years, when books are closed on 31st March every year.

 

The solution of Question No 11 Chapter No 13:-  

 

Dr. Building A/c Cr.
Date Particulars
J.F. Amount Date Particulars
J.F. Amount
01/07/16 To Cash A/c   12,00,000 31/03/17 By Deprecation A/c*1   90,000
        31/03/17 By Balance C/d   11,10,000
      12,00,000       12,00,000
01/03/17 To Balance b/d   11,10,000 31/03/18 By Deprecation A/c*2   1,20,000
        31/03/18 By Balance C/d   9,90,000
      11,10,000       11,10,000
01/03/18 To Balance b/d   9,90,000
31/03/19 By Deprecation A/c*3   19,000
01/31/19 To Profit on sale o machinery   8,30,000 31/03/19 By Balance C/d   1,73,500
      18,20,000       18,20,000
01/03/17 To Balance b/f   1,73,500 31/03/18 By Deprecation A/c*4   1,20,000
        31/03/19 By Sale A/c   17,00,000
      18,20,000       18,20,000

 

 

Working note:-

*1:- Calculation of the amount of Depreciation on furniture for the year 2016-17
Machinery purchased on 1st July 2016
Depreciation = Value of Asset X Rate of Depreciation X Period
Value of Asset = 12,00,000
Rate of Depreciation = 10%
Period = from 01/07/2016 to 31/03/2017 i.e. 12 months
(from the date of purchase/Beginning balance to the end of the financial year)
= 12,00,000 X 10/100 X 9 / 12
Depreciation = 90,000
Total Depreciation for the year = 90,000



*2:- Calculation of amount of Depreciation on furniture for year 2017-18
Machinery purchased on 1st July 2016
Depreciation = Value of Asset X Rate of Depreciation X Period
Value of Asset = 12,00,000
Rate of Depreciation = 10%
Period = from 01/04/2017 to 31/03/2018 i.e. 12 months
(from the date of purchase/Beginning balance to end of the financial year)
= 12,00,000 X10/100 X 12 / 12
Depreciation = 1,20,000
Total Depreciation for the year = 1,20,000



Statement Showing profit or loss on the sale of Machinery  
Particulars
Amount
Purchase value of machinery as on 1st July 2016 12,00,000
Less: – Amount of Depreciation charged on the year 2016-17  
12,00,000*10%*9/12 90,000
 Amount of Depreciation charged on the year 2017-18  
12,00,000*10%*12/12 1,20,000
 Amount of Depreciation charged on year 2018-19  
12,00,000*10%*12/12 1,20,000
Book value of an asset as on 31st March 2019 8,70,000
Sale Price of Machinery 17,00,000
Profit on the sale of the asset 8,30,000

 

 

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)

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