Question No 08 Chapter No 12
08.Bhushan & Company purchased a Machinery on 1st April, 2015, for 54,000 and spent 6,000 on its installation. On 1st December, 2016, it purchased another machine for 30,000.
On 30th June 2017, the first machine purchased on 1st April, 2015, is sold for 36,000 and on the same date it purchased a new machinery for 80,000.
On December 1, 2018, the second machine (purchased on December 1, 2016) was also sold off for 26,000.
Depreciation was provided on machinery @ 10% p.a. on Original Cost Method annually on 31st March. Give the machinery account for
four years.
The solution of Question No 08 Chapter No 12: –
| Dr. | Machinery A/c | Cr. | |||||
| Date | Particulars |
J.F. | Amount | Date | Particulars |
J.F. | Amount |
| 1st Apr.2015 | To Bank A/c | 60,000 | 31st Mar2016 | By Deprecation A/c(12,500 + 2,500) | 6,000 | ||
| 31st Mar2016 | By Balance C/d | 54,000 | |||||
| 60,000 | 60,000 | ||||||
| 1st Apr.2016 | To Balance b/f | 54,000 | 31st Mar2017 | By Deprecation A/c(6,000 + 1,000) | 7,000 | ||
| 1st Dec.2016 | To Bank A/c | 30,000 | 31st Mar 2017 | By Balance C/d |
3,17,500 |
||
| 84,000 | 84,000 | ||||||
| 1st Apr 2017 | To Balance b/f | 77,000 | 30th Jun 2017 | By Deprecation A/c | 1,500 | ||
| 30th Jun 2017 | To Bank A/c | 80,000 | 30th Jun 2017 | By Bank A/c | 36,000 | ||
| 30th Jun 2017 | By Profit & Loss A/c | 10,500 | |||||
| 1st Mar 2018 | By Deprecation A/c(3,000 + 6,000) | 9,000 | |||||
| 31st Mar2018 | By Balance C/d | 1,00,000 |
|||||
| 1,57,000 | 1,57,000 | ||||||
| 1st Apr 2018 | To Balance b/f | 1,00,000 | 1st Dec 2017 | By Deprecation A/c | |||
| 1st Dec 2017 | To Profit & Loss A/c | 2,000 | 1st Dec 2017 | By Bank A/c | |||
| 1st Mar 2019 | By Deprecation A/c | ||||||
| 31st Mar2019 | By Balance C/d | 66,000 |
|||||
| 1,02,000 |
1,02,000 |
||||||
Working Note:
Calculation of Depreciation
| Statement Showing profit or loss on the sale of Machinery | |
| Particulars |
Amount |
| Machinery Purchase on of Equipment as on 1st Apr. 2015 | 60,000 |
| Less: – Amount of Depreciation charged on the year 2015-16 | |
| 60,000 *10%* 12/12 | 6,000 |
| Amount of Depreciation charged on the year 2016-17 | |
| 60,000 *10%* 12/12 | 6,000 |
| Amount of Depreciation charged on the year 2017-18 | |
| 60,000 *10%* 3/12 | 1,500 |
| Book value of an asset as of 31st Dec 2018 | 46,500 |
| Sale Price of Machinery | 36,000 |
| Loss on the sale of the asset | 10,500 |
| Statement Showing profit or loss on the sale of Machinery | |
| Particulars |
Amount |
| Machinery Purchase on of Equipment as on 1st Dec. 2016 | 60,000 |
| Less: – Amount of Depreciation charged on the year 2016-17 | |
| 30,000 *10%* 4/12 | 1,000 |
| Amount of Depreciation charged on the year 2017-18 | |
| 30,000 *10%* 12/12 | 3,000 |
| Amount of Depreciation charged on the year 2018-19 | |
| 30,000 *10%* 9/12 | 2,000 |
| Book value of an asset as of 31st Dec 2018 | 24,000 |
| Sale Price of Machinery | 26,000 |
| Loss on the sale of the asset | 2,000 |
https://tutorstips.com/depreciation/
Comment if you have any question.
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.
