Question

A firm purchased an old machinery for `37,000 on 1st January, 2015 and spent `3,000 on its overhauling. On 1st July 2016, another machine was purchased for `10,000. On 1st July 2017, the machinery which was purchased on 1st January 2015, was sold for `28,000 and the same day a new machinery costing `25,000 was purchased. On 1st July, 2018, the machine which was purchased on 1st July 2016 was sold for `2,000. Depreciation is charged at SMART LEARN EDUCARECA FOUNDATON NOV 202010% per annum on straight line method. The firm changed the method and adopted diminishing balance method with effect from 1st January, 2016 and the rate was increased to 15% per annum. The books are closed on 31st December every year. Prepare machinery account for the four years from 1st January 2015.

Answer 1

Machinery Account for the 4 years

Explanation:

Pls refer to the pic below