Question No 30 Chapter No 14 – T.S. Grewal 11 Class

Question No 30 Chapter No 14

Question No 30 Chapter No 14

30. A firm purchased on 1st April 2015 certain machinery for ₹ 5,82,000 and spent ₹ 18,000 on its installation. On 1st October 2015, additional machinery costing ₹ 2,00,000 was purchased. On 1st October 2017, the machinery purchased on 1st April 2015 was auctioned for ₹ 2,86,000 plus CGST and SGST @ 6% each and new machinery for ₹ 4,00,000, plus IGST @ 12% was purchased on the same date. Depreciation was provided annually on 31st March at the rate of 10% p.a. on the Written Down Value Method. Prepare the Machinery Account for the three years ended 31st March 2018.


The solution of Question No 30 Chapter No 14: –

Dr. Machinery A/c Cr.
Date Particulars
J.F. Amount Date Particulars
J.F. Amount
01/04/15 To Bank A/c   6,00,000 31/03/16 By Deprecation A/c*1   70,000
01/10/15 To Bank A/c   2,00,000 31/03/16 By Balance C/d   7,30,000
      8,00,000       8,00,000
01/04/16 To Balance b/d   7,30,000 31/03/17 By Deprecation A/c*2   42,500
        31/03/17 By Balance C/d   6,57,000
      7,30,000       7,30,000
01/04/17 To Balance b/d   6,57,000 01/10/17 By Deprecation A/c   24,300
01/10/17 To Bank A/c   4,00,000 01/10/17 By Bank A/c   2,86,000
        01/10/17 By Loss on sale of Machine A/c   1,75,700
        31/03/18 By Deprecation A/c*3   37,100
        31/03/18 By Balance C/d   5,33,900
      10,57,000
      10,57,000

 

Working Note:-`

*1:– Calculation of the amount of Depreciation on Machine for the year 2015-16
 Purchased on 1st April 2015

Depreciation = Value of Asset X Rate of Depreciation X Period
Value of Asset = 6,00,000
Rate of Depreciation = 10%
Period = from 01/04/2015 to 31/03/2016 i.e.12months
(from the date of purchase/Beginning balance to the end of the financial year)
=6,00,000 X10/100 X 12/12
Depreciation =60,000
Purchased on 1st October 2015
Depreciation = Value of Asset X Rate of Depreciation X Period
Value of Asset = 2,00,000
Rate of Depreciation = 10%
Period = from 01/10/2015 to 31/03/2016 i.e.6months
(from the date of purchase/Beginning balance to the end of the financial year)
=2,00,000 X10/100 X 12/12
Depreciation = 10,000
Total Depreciation for the year = 70,000



*2:- Calculation of the amount of Depreciation on furniture for the year 2016-17
 Purchased on 1st April,2015

Depreciation = Value of Asset X Rate of Depreciation X Period
Value of Asset = 5,40,000
Rate of Depreciation = 10%
Period = from 01/04/2016 to 31/03/2017 i.e.12months
(from the date of purchase/Beginning balance to the end of the financial year)
=5,40,000 X10/100 X 12/12
Depreciation = 54,000
 Purchased on 1st October,2015
Depreciation = Value of Asset X Rate of Depreciation X Period
Value of Asset = 1,90,000
Rate of Depreciation = 10%
Period = from 01/04/2016 to 31/03/2017 i.e.12months
(from the date of purchase/Beginning balance to the end of the financial year)
=1,90,000 X10/100 X 12/12
Depreciation = 19,000
Total Depreciation for the year = 73,000


Statement Showing profit or loss on the sale of Machinery  
Particulars
Amount
Purchase value of machinery as on 1st April 2015 6,00,000
Less: – Amount of Depreciation charged on the year 2015-16  
6,00,000*10%*12/12 60,000
 Amount of Depreciation charged on the year 2016-17  
5,40,000*10%*12/12 54,000
 Amount of Depreciation charged on the year 2017-18  
4,86,000*10%*6/12 24,300
Book value of the asset as on 1st March 2017 4,61,700
Sale Price of Machinery 2,86,000
Loss on the sale of the asset 1,75,700

*3:- Calculation of the amount of Depreciation on furniture for the year 2015-16
Purchased on 1st October 2015
Depreciation = Value of Asset X Rate of Depreciation X Period
Value of Asset = 1,71,000
Rate of Depreciation = 10%
Period = from 01/04/2010 to 31/03/2011 i.e.12months
(from the date of purchase/Beginning balance to the end of the financial year)
=1,71,000 X10/100 X 12/12
Depreciation = 17,100
Purchased on 1st October 2017
Depreciation = Value of Asset X Rate of Depreciation X Period
Value of Asset = 4,00,000
Rate of Depreciation = 10%
Period = from 01/10/2017 to 31/03/2018 i.e.6months
(from the date of purchase/Beginning balance to the end of the financial year)
=4,00,000 X10/100 X 6/12
Depreciation = 20,000
Total Depreciation for the year = 37,100



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 30 Chapter No 14 - T.S. Grewal 11 Class

T.S. Grewal’s Double Entry Book Keeping

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