# Question No 13 Chapter No 14 – T.S. Grewal 11 Class

Question No.13 - Chapter No.14- T.S. Grewal +1 Book 2019-Solution

Question No 13 Chapter No 14

13. A firm purchased a second- hand machine on 1st April 2015 and paid 1,40,000 for it. It spent on its overhauling and installation Rs 20,000. on 1st October 2015, another machine costing Rs 80,000 was purchased. On 1st October 2017, the machine purchased on 1st April 2015 was disposed of for Rs 1,04,000, charging CGST and SGST @6% each and new machine costing Rs 2,00,000 was installed, paying CGST and SGST @6% each. Deprecation as provided @10%p.a. by the Straight Line method. Give the Machinery Account and Deprecation Account for the 3 years. Firm ‘s books are closed on 31st March every year.

The solution of Question No 13 Chapter No 14: –

 Dr. Machine A/c Cr. Date Particulars J.F. Amount Date Particulars J.F. Amount 01/04/15 To Cash A/c 1,60,000 31/03/16 By Deprecation A/c *1 20,000 01/10/15 To Cash A/c 80,000 31/03/16 By Balance C/d 2,20,000 2,40,000 2,40,000 01/04/16 To Balance b/d 2,20,000 31/03/17 By Deprecation A/c 24,000 31/03/17 By Balance C/d 1,96,000 2,20,000 2,20,000 01/04/17 To Balance b/d 1,96,000 01/10/17 By Cash A/c 1,04,000 01/10/17 To Cash A/c 2,00,000 01/10/17 By Deprecation A/c 8,000 01/10/17 By loss on the sale of plant A/c 16,000 31/03/18 By Deprecation A/c 18,000 31/03/18 By Balance C/d 2,50,000 3,96,000 3,96,000

 Dr. Depreciation A/c Cr. Date Particulars J.F. Amount Date Particulars J.F. Amount 31/06/16 To Machinery A/c 20,000 31/03/16 By Profit and Loss A/c 20,000 20,000 20,000 31/03/17 To Machinery A/c 24,000 31/03/17 By Profit and Loss A/c 24,000 24,000 24,000 01/10/17 To Machinery A/c 8,000 31/03/18 To Machinery A/c 18,000 31/03/18 By Profit and Loss A/c 26,000 26,000 26,000

Working note:-

*1:- Calculation of the amount of Depreciation on machinery for F/Y 2015-16
Purchased on 1st April 2015
Depreciation = Value of Asset X Rate of Depreciation X Period

Value of Asset = 1,60,000
Rate of Depreciation = 10%
Period = from 01/04/15 to 31/03/16 i.e. 9 months
(from the date of purchase/Beginning balance to the end of the financial year)
=1,60,000 X 10/100 X 12/12
Depreciation =16,000

Purchased 1st October 2015
Depreciation = Value of Asset X Rate of Depreciation X Period

Value of Asset = 80,000
Rate of Depreciation = 10%
Period = from 01/10/15 to 31/03/16 i.e. 6 months
(from the date of purchase/Beginning balance to the end of the financial year)
= 80,000 X 10/100 X 6/12
Depreciation = 4,000
Total Depreciation for the finical year 2014-15 =20,000

*2:- Calculation of the amount of Depreciation on machinery for F/Y 2017-18
Purchased on 1st October 2015
Depreciation = Value of Asset X Rate of Depreciation X Period

Value of Asset = 80,000
Rate of Depreciation = 10%
Period = from 01/04/17 to 31/03/18 i.e. 12 months
(from the date of purchase/Beginning balance to the end of the financial year)
=80,000 X 10/100 X 12/12
Depreciation =8,000
Purchased 1st October 2017
Depreciation = Value of Asset X Rate of Depreciation X Period

Value of Asset = 2,00,000
Rate of Depreciation = 10%
Period = from 01/10/15 to 31/03/16 i.e. 6 months
(from the date of purchase/Beginning balance to the end of the financial year)
= 2,00,000 X 10/100 X 6/12
Depreciation = 1,000
Total Depreciation for the finical year 2017-18= 18,000

One –third of the plant was sold

 Statement Showing profit or loss on the sale of Machinery Cr. Particulars Amount Book value of machinery as on 1st April 2015 when it was purchased 1,60,000 Less: – Amount of Depreciation charged on the year 2015-16 1,60,000*10%*12/12 16,000 Amount of Depreciation charged on the year 2016-17 16,000 Amount of Depreciation charged on the year 2017-18 1,60,000*10%*6/12 8,000 Sale Price of Machinery 1,04,000 Loss on the sale of the asset 16,000

Depreciation | Meaning | Methods | Examples

Comment if you have any question.

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

• Chapter No. 1 – Introduction to Accounting
• Chapter No. 2 – Basic Accounting Terms
• Chapter No. 3 – Theory Base of Accounting, Accounting Standards and International Financial Reporting Standards(IFRS)
• Chapter No. 4 – Bases of Accounting
• Chapter No. 5 – Accounting Equation
• Chapter No. 6 – Accounting Procedures – Rules of Debit and Credit
• Goods and Services Tax(GST)
• Chapter No. 7 – Origin of Transactions – Source Documents and Preparation of Vouchers
• Chapter No. 8 – Journal
• Chapter No. 9 – Ledger
• Chapter No. 10 – Special Purpose Books I – Cash Book
• Chapter No. 11 – Special Purpose Books II – Other Books
• Chapter No. 12 – Bank Reconciliation Statement
• Chapter No. 13 – Trial Balance
• Chapter No. 14 – Depreciation
• Chapter No. 15 – Provisions and Reserves
• Chapter No. 16 – Accounting for Bills of Exchange
• Chapter No. 17 – Rectification of Errors
• Chapter No. 18 – Financial Statements of Sole Proprietorship
• Chapter No. 19 – Adjustments in preparation of Financial Statements
• Chapter No. 20 – Accounts from incomplete Records – Single Entry System
• Chapter No. 21 – Computers in Accounting
• Chapter No. 22 – Accounting Software – Tally
• Chapter No. 5 – Accounting Equation
• Chapter No. 6 – Accounting Procedures – Rules of Debit and Credit
• Goods and Services Tax(GST)
• Chapter No. 8 – Journal
• Chapter No. 9 – Ledger
• Chapter No. 10 – Special Purpose Books I – Cash Book

T.S. Grewal’s Double Entry Book Keeping