Question No 24 Chapter No 13
Depreciation on Written Down Value
24. On 1st April, 2015, Pandit Bros. purchased a machinery by cheque for Rs 4,80,000 and spends Rs 20,000 on its installation. The depreciation to be provided at the rate of 20% p.a. on diminishing balance method. Write up the machinery Account for the years 2015-16 to 2017-18
The solution of Question No 24 Chapter No 13:-
| Dr. | Machine A/c | Cr. | |||||
| Date | Particulars |
J.F. | Amount | Date | Particulars |
J.F. | Amount |
| 01/04/15 | To Cash A/c | 5,00,000 | 31/03/16 | By Deprecation A/c*1 | 1,00,000 | ||
| 31/03/16 | By Balance C/d | 4,00,000 | |||||
| 5,00,000 | 5,00,000 | ||||||
| 01/04/16 | To Balance b/d | 4,00,000 | 31/03/17 | By Depreciation A/c*2 | 80,000 | ||
| 31/03/17 | By Balance C/d | 3,20,000 | |||||
| 4,00,000 | 4,00,000 | ||||||
| 01/04/17 | To Balance b/d | 3,20,000 | 31/03/18 | By Deprecation A/c*3 | 64,000 | ||
| 31/03/19 | 8By Balance C/d | 2,56,000 | |||||
| 3,20,000 | 3,20,000 | ||||||
Note: The amount of depreciation have to charged for the year 2015-16 for the half the year to find the answer which given the in the book.
Working note:-
*1:- Calculation of the amount of Depreciation on furniture for the year 2015-16
Machinery purchased on 1st Apr 2015
Depreciation = Value of Asset X Rate of Depreciation X Period
Value of Asset = 5,00,000
Rate of Depreciation = 20%
Period = from 01/04/2015 to 31/03/2016 i.e. 12 months
(from the date of purchase/Beginning balance to the end of the financial year)
= 5,00,000 X 20/100 X 12/ 12
Depreciation = 1,00,000
Total Depreciation for the year = 1,00,000
*2:– Calculation of the amount of Depreciation on furniture for year 2016-17
Machinery purchased on 1st Apr 2015
Depreciation = Value of Asset X Rate of Depreciation X Period
Value of Asset = 4,00,000
Rate of Depreciation = 20%
Period = from 01/10/2016 to 31/03/2017 i.e. 12 months
(from the date of purchase/Beginning balance to end of the financial year)
= 4,00,000 X 20/100 X 12/ 12
Depreciation = 80,000
Total Depreciation for the year = 80,000
*3:- Calculation of the amount of Depreciation on furniture for the year 2018-19
Machinery purchased on 1st Apr 2015
Depreciation = Value of Asset X Rate of Depreciation X Period
Value of Asset = 3,20,000
Rate of Depreciation = 20%
Period = from 01/04/2017 to 31/03/2018 i.e. 12 months
(from the date of purchase/Beginning balance to the end of the financial year)
= 3,20,000 X 20/100 X 12/ 12
Depreciation = 64,000
Total Depreciation for the year = 64,000
Depreciation | Meaning | Methods | Examples
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Also, Check out the solved question of all Chapters: –
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
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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)