Question No 31 Chapter No 12 – D.K Goal 11 Class

Question No 31 Chapter No 12

Question No 31 Chapter No 12

Free Accounting book Solution - Class 11 and Class 12

31.On 1st July 2017, X Ltd. purchased machinery for 15,00,000. Depreciation is provided @ 20% p.a. on the original cost of the machinery and books are closed on 31st March each year. On 31st May 2017, a part of this machine purchased on 1st July 2010 for 3,60,000 was sold for 2,40,000 and on the same date, new machinery was purchased for 4,20,000. You are required to prepare (a) Machinery Account, (b) Provision for Depreciation Account, and (c) Machinery Disposal Account.

The solution of Question No 31 Chapter No 12: –

Dr. Machinery A/c Cr.
Date Particulars
J.F. Amount Date Particulars
J.F. Amount
1st Jul.2017 To Balance b/f (11,40,0000 + 3,60,000)   15,00,000        
        31st Mar 2018 By Balance C/d   15,00,000
      15,00,000       15,00,000
1stMar.2018 To Balance b/f   15,00,000        
        31st Mar 2019
By Balance C/d
  15,00,000
      15,00,000
      15,00,000
1st Apr.2019 To Balance b/f   15,00,000 31st May.2019 By Machinery Disposal A/c   3,60,000
31st May.2019 To Bank A/c   4,20,000 31st Mar 2019
By Balance C/d
  15,60,000
      19,20,000
      19,20,000
Dr. Machinery Disposal A/c Cr.
Date Particulars
J.F. Amount Date Particulars
J.F. Amount
31st May 2019 To Machinery A/c   3,60,000 31st May 2019 By Provision for Depreciation A/c   1,38,000
31st May 2019 To Profit & Loss A/c   18,000 31st May 2019 By Bank A/c (sale)   2,40,000
      3,78,000       3,78,000
Dr. Provision for Depreciation  A/c Cr.
Date Particulars
J.F. Amount Date Particulars
J.F. Amount
        31st Mar 2017 By Depreciation A/c (20,000 + 40,000)   2,25,000
31stMar.2017 Balance c/d   2,25,000        
      2,25,000       2,25,000
        31st Apr 2017 By Balance b/d   2,25,000
31st Mar.2018 Balance c/d   5,25,000
31st Mar 2018 By Depreciation A/c (36,000 + 72,000 + 7,500)   3,00,000
      5,25,000
      5,25,000
31st Jul.2018 To Machinery A/c (54,000 + 72,000 +12,000)   1,38,000 31st Apr 2018 By Balance b/d   5,25,000
        31st May.2018 By Depreciation A/c (2 Months)   12,000
31st Mar.2020 To Balance b/f   6,97,000
31st Mar.2019 By Depreciation A/c (57,600 + 28,500)   2,98,000
      8,35,000
      8,35,000

Working Note:
Calculation of Profit or Loss on Sale M1

Statement Showing the Profit and loss on the sale of Plant
Particulars
Amount
Machinery Purchase on of Equipment as on 1st Jul. 2017 3,60,000
Less: – Amount of Depreciation charged on the year 2017-18  
3,60,000 *20%* 9/12 54,000
Amount of Depreciation charged on the year 2018-19  
3,60,000 *20%* 12/12 72,000
Amount of Depreciation charged on the year 2019-20  
3,60,000 *20%* 2/12 12,000
Book value of asset as of 31st May 2019 2,22,000
Sale Price of Machinery 2,40,000
Profit on the sale of the asset 18,000
*Depreciation charged during the year
Particulars
Amount
On Rs 11,40,000 @ 20% 2,28,000
On Rs 4,20,000 @ 20% for 10 months 70,000
Profit on the sale of the asset 2,98,000

Depreciation | Meaning | Methods | Examples

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