Question No 19 Chapter No 13 – USHA Publication 11 Class

Question No 19 Chapter No 13

Question No 19 Chapter No 13

Sale of Total Assets

19. Mummun Sen bought furniture for Rs 36,000 and spent Rs 4,000 for its fitting and cartage on 1st April 2014. Additional furniture was bought on 1st October 2014 for Rs 20,000. while the first furniture was to serve for 10 years with no scrap value, the second one to serve for 5 years to leave a scrap of Rs 4,000. on 1st July 2015, another item of furniture was bought for Rs 10,000, charging 10%p.a. depreciation on cost. On 30th June 2016 the furniture purchased on 1st October 2014 was auctioned at 60% of its book value and the first furniture was disposed of at par on 31st March 2017 and replaced by new furniture of Rs 15,000 to serve for 6 years when scrap was esteemed to be Rs 3,000. show furniture Account till 2017-18 with all calculation.

The solution of Question No 19 Chapter No 13:-  

Dr. Furniture A/c Cr.
Date Particulars
J.F. Amount Date Particulars
J.F. Amount
01/04/14 To Cash A/c   40,000 31/03/15 By Deprecation A/c*1   5,600
01/10/14 To Cash A/c   20,000 31/03/15 By Balance C/d   54,400
      60,000       60,000
01/04/15 To Balance b/d   54,400 31/03/16 By Deprecation A/c*2   7,950
01/07/15 To Cash A/c   10,000 31/03/16 By Balance C/d   56,450
      64,,400       64,,400
01/04/16 To Balance b/d   56,450 30/06/17 By Bank A/c   8,640
01/03/17 To Bank A/c   15,000 30/06/17 By Profit/Loss A/c   5,760
        30/06/17 By Deprecation A/c   800
        31/03/17 By Bank A/c   28,000
        31/03/17 By Deprecation A/c*3   5,000
        31/03/17 By Balance C/d   23,250
      71,450       71,450
01/04/18 To Balance b/f   23,250 31/03/19 By Deprecation A/c*4   3,000
        31/03/19 By Balance C/d   20,250
      23,250
      23,250

 

Working note:-

*1:- Calculation of amount of Depreciation on furniture purchased on 1st April, 2014
The method of calculating the Deprecation rate:
Depreciation = Value of Asset X Rate of Depreciation X Period

Amount of Depreciation = Cost of assets- Estimated Realizable or Scrap value
Number of years of expected useful life

Cost of assets = Cost of Furniture + Fitting = 36,000 + 4,000
Number of years of expected useful life = 5 years

Amount of Depreciation = 40,000  = 4,000
10

*2:- Calculation of the amount of Depreciation on furniture purchased on 1st October 2014
The method of calculating the Deprecation rate:
Cost of assets = Cost of Furniture + Fitting = 20,000
Number of years of expected useful life = 5 years
Estimated Retaliated or Scrap value = 4,000

Amount of Depreciation = 20,000 – 4,000  = 3,200
5

 

Statement Showing the Profit and loss on the sale of Furniture  
Particulars
Amount
Purchase value of machinery as on 1st April 2014 20,000
Less: – Amount of Depreciation charged on the year 2014-15  
3,200 6/12 1,600
 Amount of Depreciation charged on the year 2015-16  
3,200 12/12 3,200
 Amount of Depreciation charged on the year 2016-17  
3,200 3/12 800
Book value of the asset as on 30th June 2016 14,400
Sale Price of Machinery 8,640
Loss on the sale of the asset 5,760

 

Statement Showing the Profit and loss on the sale of Furniture  
Particulars
Amount
Purchase value of machinery as on 1st October, 2014 40,000
Less: – Amount of Depreciation charged on the year 2014-15  
4,000 12/12 4,000
 Amount of Depreciation charged on the year 2015-16  
4,000 12/12 4,000
 Amount of Depreciation charged on the year 2016-17  
4,000 12/12 4,000
Book value of the asset as on 30th June 2016 28,000
Sale Price of Machinery 28,000
Loss on the sale of the asset Nil

 

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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