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Question No 17 Chapter No 12
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17. Raja Textiles Co. which closes its books on 31st March, purchased a machine on 1-4-2009 for 50,000. On 1-10-2010, it purchased an additional machine for 30,000. The part of the machine which was purchased on 1-4-2009 costing 10,000 was sold for 3,600 on 30th Sept., 2012. Prepare the Machine Account for four years, if the depreciation is provided at the rate of 10% p.a. on Diminishing Balance Method.
The solution of Question No 17 Chapter No 12: –
| Dr. | Machinery A/c | Cr. | |||||
| Date | Particulars | J.F. | Amount | Date | Particulars | J.F. | Amount |
| 1st Apr.2016 | To Bank A/c (10,000+ 40,000) | 50,000 | 31st Mar 2017 | By Deprecation A/c | 5,000 | ||
| 31st Mar 2017 | By Balance C/d | 45,000 | |||||
| 50,000 | 50,000 | ||||||
| 1st Apr.2017 | To Balance b/f | 45,000 | 31st Mar 2018 | By Deprecation A/c (900 +3,600 + 1500) | 6,000 | ||
| 1st Oct.2017 | To Bank A/c | 30,000 | 31st Mar 2018 | By Balance C/d | 6,95,000 | ||
| 75,000 | 75,000 | ||||||
| 1st Apr.2018 | To Balance b/f | 69,000 | 31st Mar 2019 | By Deprecation A/c (810 + 3,240 + 2,850) | 6,900 | ||
| 31st Mar 2019 | By Balance C/d (7,290 + 29,160 + 25,650) | 62,100 | |||||
| 69,000 | 69,000 | ||||||
| 1st Apr.2019 | To Balance b/f | 62,100 | 30th Sep.2019 | By Deprecation A/c | 365 | ||
| 30th Sep.2019 | By Bank A/c | 3,600 | |||||
| 30th Sep.2019 | By Profit & Loss A/c | 3,325 | |||||
| 31st Mar 2020 | By Deprecation A/c (29,160 + 26,100+2,000) | 5,481 | |||||
| 31st Mar 2020 | By Balance C/d | 49,329 | |||||
| 62,100 | 62,100 | ||||||
Working Note:
Calculation of Profit or Loss on Sale
| Statement Showing profit or loss on the sale of Machinery | |
| Particulars | Amount |
| Machinery Purchase on of Equipment as on 1st Apr. 2016 | 10,000 |
| Less: – Amount of Depreciation charged on the year 2017-18 | |
| 10,000 *10%* 12/12 | 1,000 |
| Amount of Depreciation charged on the year 2018-19 | |
| 9,000 *10%* 12/12 | 900 |
| Amount of Depreciation charged on the year 2019-20 | |
| 81,000 *10%* 12/12 | 810 |
| Amount of Depreciation charged on the year 2019-20 | |
| 7,290 *10%* 6/12 | 365 |
| Book value of an asset as of 1st Oct 2019 | 6,925 |
| Sale Price of Machinery | 3,600 |
| Loss on the sale of the asset | 3,325 |
Note: In order to make an easy calculation, machinery purchased on April 01, 2017, has been divided into two parts i.e. M1 and M2. Thus, M1: Rs 10,000 (sold for Rs 3,600) M2: Rs 40,000
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Depreciation | Meaning | Methods | Examples
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Also, Check out the solved question of all Chapters: –
D K Goel – New ISC Accountancy -(Class 11 – ICSE)- Solution
- Chapter 1 Evolution of Accounting & Basic Accounting Terms
- Chapter 2 Accounting Equations
- Chapter 3 Meaning and Objectives of Accounting
- Chapter 4 Double Entry System
- Chapter 5 Books of Original Entry – Journal
- Chapter 6 Accounting for Goods and Service Tax (GST) (Coming soon)
- Chapter 7 Books of Original Entry – Cash Book (Coming soon)
- Chapter 8 Books of Original Entry – Special Purpose Subsidiary Books (Coming soon)
- Chapter 9 Ledger (Coming soon)
- Chapter 10 Trial Balance and Errors (Coming soon)
- Chapter 11 Bank Reconciliation Statement (Coming soon)
- Chapter 12 Depreciation (Coming soon)
- Chapter 13 Bills of Exchange (Coming soon)
- Chapter 14 Generally Accepted Accounting Principles(GAAP)
- Chapter 15 Bases of Accounting
- Chapter 16 Accounting Standards and International Financial Reporting Standard(IFRS) (Coming soon)
- Chapter 17 Capital and Revenue
- Chapter 18 Provisions and Reserves
- Chapter 19 Final Accounts (Coming soon)
- Chapter 20 Final Accounts – With Adjustments (Coming soon)
- Chapter 21 Errors and their Rectification (Coming soon)
- Chapter 22 Accounts from Incomplete Records – Single Entry System (Coming soon)
- Chapter 23 Accounts of Not-for-Profit Organisations (Coming soon)
- Chapter 24 Computerised Accounting System (Coming soon)
- Chapter 25 Introduction to Accounting Information System (Coming soon)
Check out the Accountancy Class +1 by D.K. Goal (Arya Publication) from their official Site.
