Question No 25 Chapter No 14 – T.S. Grewal 11 Class

Question No 25 Chapter No 14

Question No 25 Chapter No 14

25. A Machinery was purchased for ₹ 1,80,000 on 1st July, 2015. Depreciation was charged annually @ 10% on Diminishing Balance Method. 1/4th of this Machinery was sold on 1st October, 2017 for 36,000. Prepare Machinery A/c from the year ended 31st March, 2016 to 2018, if the books are closed on 31st March every year.


The solution of Question No 25 Chapter No 14: –

Dr. Machinery A/c Cr.
Date Particulars
J.F. Amount Date Particulars
J.F. Amount
01/07/15 To Bank A/c   1,80,000 31/03/16 By Deprecation A/c*1   13,500
        31/03/16 By Balance C/d   1,66,500
      1,80,000       1,80,000
01/04/16 To Balance b/d   1,66,500 31/03/17 By Deprecation A/c   16,650
        31/03/17 By Balance C/d   1,49,850
      1,66,500       1,66,500
01/04/17 To Balance b/d   1,49,850 31/10/17 By Deprecation A/c   1,873
01/10/17 To Profit on sale of Machinery A/c   410 31/10/17 By Bank A/c   36,000
        31/03/18 By Deprecation A/c*2   11,239
        31/03/18 By Balance C/d   1,01,148
      1,50,260
      1,50,260

Working Note:-

*1:- Calculation of the amount of Depreciation on furniture for the year 2016-17
Purchased on 1st July 2015
Depreciation = Value of Asset X Rate of Depreciation X Period
Value of Asset = 1,80,000
Rate of Depreciation = 10%
Period = from 01/07/2016 to 31/03/2017 i.e.9months
(from the date of purchase/Beginning balance to the end of the financial year)
=1,80,000 X10/100 X 9/12
Depreciation =13,500
Total Depreciation for the year = 2,300

Statement Showing profit or loss on the sale of Machinery  
Particulars
Amount
The purchase value of machinery as on 1st July 2015 (1,80,000 *1/4) out of which 1/4 sold 45,000
Less: – Amount of Depreciation charged on the year 2015-16  
45,000*10%*9/12 3,375
 Amount of Depreciation charged on the year 2016-17  
41,625*10%*12/12 4,162
 Amount of Depreciation charged on the year 2017-18  
37,463*10%*6/12 1,873
Book value of the asset as on 1st April 2018 35,590
Sale Price of Machinery 36,000
Profit on the sale of the asset 410

 

*2:- Calculation of the amount of Depreciation on furniture for the year 2017-18
purchased on 1st July 2015
Depreciation = Value of Asset X Rate of Depreciation X Period
Value of Asset = 1,12,388
Rate of Depreciation = 10%
Period = from 01/03/2017 to 31/03/2018 i.e.12months
(from the date of purchase/Beginning balance to the end of the financial year)
=1,12,388 X10/100 X 12/12

Depreciation 11,239
Total Depreciation for the year 11,239

 

Depreciation | Meaning | Methods | Examples

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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

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T.S. Grewals Double Entry Book Keeping - Question No 25 Chapter No 14 - T.S. Grewal 11 Class

T.S. Grewal’s Double Entry Book Keeping

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