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Question No 33 Chapter No 12
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33. On 1st June, 2017, Kedarnath Ltd. purchased a machinery for 27,00,000. Depreciation is provided @ 10% p.a. on diminishing balance method and the books are closed on 31st March each year. On 1st October, 2019, a part of the machinery purchased on 1st June, 2017 for 6,00,000 was sold for 3,50,000 and on the same date another machinery was purchased for 8,00,000. You are required to show (i) Machinery A/c, (ii) Provision for Dep. A/c, and (iii) Machinery Disposal A/c.
The solution of Question No 33 Chapter No 12: –
| Dr. | Plant A/c | Cr. | |||||
| Date | Particulars | J.F. | Amount | Date | Particulars | J.F. | Amount |
| 1st Jun.2017 | To Bank A/c (6,00,000 + 21,00,000) | 27,00,000 | |||||
| 31st Mar 2018 | By Balance C/d | 27,00,000 | |||||
| 27,00,000 | 27,00,000 | ||||||
| 1st Apr.2018 | To Balance b/f | 27,00,000 | |||||
| 31st Mar 2019 | By Balance C/d | 27,00,000 | |||||
| 27,00,000 | 27,00,000 | ||||||
| 1st Apr.2019 | To Balance b/f | 27,00,000 | 31st Oct 2019 | By Plant Disposal A/c | 6,00,000 | ||
| 1st Oct.2019 | To Bank A/c | 8,00,000 | |||||
| 31st Mar 2020 | By Balance C/d | 29,00,000 | |||||
| 35,00,000 | 35,00,000 | ||||||
| Dr. | Machinery Disposal A/c | Cr. | |||||
| Date | Particulars | J.F. | Amount | Date | Particulars | J.F. | Amount |
| 1st Oct 2019 | To Machinery A/c | 6,00,000 | 1st Oct 2019 | By Provision for Depreciation A/c | 1,29,750 | ||
| 1st Oct 2019 | By Bank A/c (Sale) | 3,50,000 | |||||
| 1st Oct 2019 | By Profit & Loss A/c | 1,20,250 | |||||
| 6,00,000 | 6,00,000 | ||||||
| Dr. | Provision for Depreciation A/c | Cr. | |||||
| Date | Particulars | J.F. | Amount | Date | Particulars | J.F. | Amount |
| 31st Mar 2018 | By Depreciation A/c (50,000 + 1,75,000) | 2,25,000 | |||||
| 31stMar.2017 | Balance c/d | 2,25,000 | |||||
| 2,25,000 | 2,25,000 | ||||||
| 31st Apr 2018 | By Balance b/d | 2,25,000 | |||||
| 31st Mar.2018 | Balance c/d | 4,72,500 | 31st Mar 2018 | By Depreciation A/c (55,000 + 1,92,500) | 2,47,500 | ||
| 4,72,500 | 4,72,500 | ||||||
| 31stOct.2019 | To Plant A/c (13,500 + 18,000 +19,000) | 1,29,750 | 31st Apr 2018 | By Balance b/d | 4,72,500 | ||
| 1st Oct 2018 | By Depreciation A/c (6 Months) | 24,750 | |||||
| 31stMar.2020 | To Balance b/f | 5,80,750 | 31st Mar.2019 | By Depreciation A/c (1,02,000 + 42,000 + 10,000) | 2,13,250 | ||
| 7,10,500 | 7,10,500 | ||||||
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 Jun. 2017 | 6,00,000 |
| Less: – Amount of Depreciation charged on the year 2017-18 | |
| 6,00,000 *10%* 10/12 | 50,0000 |
| Amount of Depreciation charged on the year 2018-19 | |
| 5,50,000 *10%* 12/12 | 55,000 |
| Amount of Depreciation charged on the year 2019-20 | |
| 4,95,000 *10%* 6/12 | 24,750 |
| Book value of asset as on 1st Oct, 2019 | 4,70,250 |
| Sale Price of Machinery | 3,50,000 |
| Loss on the sale of the asset | 1,20,250 |
Note: In order to make an easy calculation, machinery purchased on June 01, 2010, has been divided into two parts i.e. M1 and M2.
Thus, M1: Rs 6,00,000 (sold for Rs 3,50,000 on Oct. 01, 2012)
M2: Rs 21,00,000
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Also, Check out the solved question of all Chapters: –
D K Goel – New ISC Accountancy -(Class 11 – ICSE)- Solution
- Chapter 1 Evolution of Accounting & Basic Accounting Terms
- Chapter 2 Accounting Equations
- Chapter 3 Meaning and Objectives of Accounting
- Chapter 4 Double Entry System
- Chapter 5 Books of Original Entry – Journal
- Chapter 6 Accounting for Goods and Service Tax (GST) (Coming soon)
- Chapter 7 Books of Original Entry – Cash Book (Coming soon)
- Chapter 8 Books of Original Entry – Special Purpose Subsidiary Books (Coming soon)
- Chapter 9 Ledger (Coming soon)
- Chapter 10 Trial Balance and Errors (Coming soon)
- Chapter 11 Bank Reconciliation Statement (Coming soon)
- Chapter 12 Depreciation (Coming soon)
- Chapter 13 Bills of Exchange (Coming soon)
- Chapter 14 Generally Accepted Accounting Principles(GAAP)
- Chapter 15 Bases of Accounting
- Chapter 16 Accounting Standards and International Financial Reporting Standard(IFRS) (Coming soon)
- Chapter 17 Capital and Revenue
- Chapter 18 Provisions and Reserves
- Chapter 19 Final Accounts (Coming soon)
- Chapter 20 Final Accounts – With Adjustments (Coming soon)
- Chapter 21 Errors and their Rectification (Coming soon)
- Chapter 22 Accounts from Incomplete Records – Single Entry System (Coming soon)
- Chapter 23 Accounts of Not-for-Profit Organisations (Coming soon)
- Chapter 24 Computerised Accounting System (Coming soon)
- Chapter 25 Introduction to Accounting Information System (Coming soon)
Check out the Accountancy Class +1 by D.K. Goal (Arya Publication) from their official Site.
