Question

a machinary costing 70000 on 1 april2015The company charges depreciation @ 10% according to written down value method. The machinery was sold on 1st April2018 for Rs.2,000 and purchased a new machinery on the same date for Rs.1,00,000. The company closes its books on 31st March every year. Write Machinery Account from
1stApril 2015 to 31st March 2019.
anwer fast​

Answer 1

Explanation:

Total cost of machinery = Rs 1,50,000 + Rs 50,000 = 2,00,000

Calculation of depreciation

Depreciation for 1st year

2,00,000@20% = 40,000

Depreciation for 2nd Year

160000(2,00,000-40,000)@20% = 32,000

Depreciation for 3rd year

1,28,000(1,60,000-32,000)@20% = 25000

Depreciation for 4th year

1,02,000(1,28,000-25000)@20% = 20,480

Which implies that the residual value of the asset at the end of 4th year is Rs 81920 (1,02,000-20,480)

Hence the estimated useful life of the asset is 4 years

Answer 2

This is your answer...hope it helps