Question

(13. Balaji & Co. purchased from the vendor two machines of Rs. 10,500 each on hire
purchase system. The payment was to be made Rs. 6,000 down and the remainder in
three equal instalments of Rs. 5,000 each together with interest at 5% p.a. Balaji &
Co. writes off depreciation at 10% p.a. on written down value. They could not pay
their second instalment. After negotiations, it was agreed that vendors would leave
one plant with the purchaser, adjusting the value of the other against amount due,
treating the machines at 20% depreciation on diminishing balance.
Show accounts in the books of Balaji & Co.
[Madras, B.Sc., May 1997]​

Answer 1

answer is in attachment