42. Shri Krishan Manufacturing Company purchased 10 machines for Rs. 75,000 each on July 01, 2014. On October 01, 2016, one of the machines got destroyed by fire and an insurance claim of Rs. 45,000 was admitted by the company. On the same date another machine is purchased by the company for Rs. 1,25,000. The company writes off 15% p.a. depreciation on written down value basis. The company maintains the calendar year as its financial year. Prepare the machinery account from 2014 to 2017.
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Dr Machinery Account Cr
Date Particulars JF Amt.(Rs) Date Particulars JF Amt.(Rs)
2000 Jul 1 To Bank A/c (75,000×10) 7,50,000 2000 Dec 31 By Depreciation A/c 56,250
7,50,000 7,50,000
2001 Jan 1 To Balance b/d 6,93,750 2001 Dec 31 By Depreciation A/c 1,04,063
Dec 31 By Balance c/d 5,89,687
6,93,750 6,93,750
2002 Jan 1 To Balance b/d 5,89,687 2002 Oct 1 By Depreciation A/c @ 15% on 58,968 for 9 months 6,634
Oct 1 To Bank A/c 1,25,000 Oct 1 By Bank A/c (Insurance Company) 45,000
Oct 1 By Profit and Loss A/c (Loss) 7,335
Dec 31 By Depreciation A/c
Old = 79,608
New = 4,688
84,296
Dec 31 By Balance c/d
Old = 4,51,110
New = 1,20,312
5,71,422
7,14,687 7,14,687
2003 Jan 1 To Balance b/d
Old = 4,51,110
New = 1,20,312
5,71,422 2003
Dec 31 By Depreciation A/c
Old = 67,667
New = 18,047
85,714
Dec 31 By Balance c/d
Old = 3,83,443
New = 1,02,665
4,85,708
5,71,422 5,71,422
Working Note
Cost of one Machine as on 1 Jan, 2002 is (5,89,687 divided by 10) = Rs.$$58,968.8
Lost on Sale of Machine = 58,969−[Dep=6,634]−[Claim=45,000]=Rs7,365
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