A company purchased a machinery at a cost of Rs 1850000 and incurred the transport and installation cost of 150000Rs on 1 st july 2016 . The machinery was expected to be useful for a period of 8 years after which it is expected to realize 200000. The company started following Reducing balance method of depreciation.
On 1st April 2020 The company realized the assets is still useful for 8 more years from now after which it will realized only 20000Rs.
The company further decided to change the method from reducing balanced method to straight line method .
You are required to prepare :
1) machinery account for the year 2020-2021 assuming depreciation is credited to asset account.
2) machinery account and provision for depreciation account for the year 2020-2021.
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