Question No 28 Chapter No 13 – USHA Publication 11 Class

Question No 28 Chapter No 13

Question No 28 Chapter No 13

WDV Method and Partial Sale

28. Samar Sachdeva purchased measuring instrument for his research laboratory worth Rs 60,000 from Precision Perfect and Co., Paying only one-fourth of the amount by cheque on 1st Oct. 2017, balance payable within a month. On 31st March 2019, he disposed of half the instruments at a profit of Rs 10,000 as his further experiments would not require them. He writes off depreciation at 10%p.a. on written down the value on 31st March every year.
Show the Instruments account from the date of purchase up to the years ending 31st March 2019

The solution of Question No 28 Chapter No 13:-  

Dr. Machine A/c Cr.
Date Particulars
J.F. Amount Date Particulars
J.F. Amount
01/10/17 To Cash A/c   15,000 31/03/18 By Deprecation A/c*1   3,000
01/10/17 To Precision Perfect & Co A/c   45,000 31/03/18 By Balance C/d   57,000
      60,000       60,000
01/04/18 To Balance b/d   57,000 31/03/19 By Depreciation A/c*2   24,000
31/03/19 To Profit/Loss A/c   10,000 31/03/19 By Bank A/c   35,650
        31/03/19 By Balance C/d   25,650
      67,000       67,000

 

Working note:-

*1:- Calculation of the amount of Depreciation on furniture for the year 2017-18
Machinery purchased on 1st Oct 2017
Depreciation = Value of Asset X Rate of Depreciation X Period
Value of Asset = 60,000
Rate of Depreciation = 10%
Period = from 01/10/2017 to 31/03/2018 i.e. 6 months
(from the date of purchase/Beginning balance to the end of the financial year)
= 60,000 X 10/100 X 6/ 12
Depreciation = 3,000
Total Depreciation for the year = 3,000

 

*2:- Calculation of the amount of Depreciation on furniture for the year 2018-19
Machinery purchased on 1st Oct 2016
Depreciation = Value of Asset X Rate of Depreciation X Period
Value of Asset = 57,000
Rate of Depreciation = 10%
Period = from 01/04/2018 to 31/03/2019  i.e. 12 months
(from the date of purchase/Beginning balance to the end of the financial year)
= 57,000 X 10/100 X 12/ 12
Depreciation = 5,700
Total Depreciation for the year = 5,700

Statement Showing profit or loss on the sale of Machinery  
Particulars
Amount
Purchase value of machinery as on 1st October 2017 30,000
Less: – Amount of Depreciation charged on the year 2017-18  
30,000 *10%* 6/12 1,500
 Amount of Depreciation charged on the year 2018-19  
28,500 *10%* 12/12 2,850
Book value of an asset as on 31st March 2019 25,650
Sale Price of Machinery 35,650
Profit on the sale of the asset 10,000

 

Depreciation | Meaning | Methods | Examples

Thanks, Please Like and share with your friends  

Comment if you have any question.

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)

Leave a Reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.