Question

birla Cotton Mills purchased a machinery on 1st May, 2018 for Rs. 90,000. On 1st July, 2019 it
purchased another machine for Rs. 40,000. On 31st March, 2020 it sold off the first machine
(purchased in 2018) for Rs. 58,000 and on the same date purchased new machinery for Rs. 100,000.
Depreciation is provided at 20% p.a. on the original cost method. Accounts were closed each year
on 31st December. Show the machinery account for the first three years.
Ans: Gain on sale Rs. 2,500: Balance bld on 2021 Rs. 113,000​

Answer 1

Answer:

The Birla Cotton Mills purchased a machinery on 1st May, 2018 for Rs. 90,000.

Explanation:

2016

Oct 01

Machinery A/c Dr. 20,000

Input CGST A/c Dr. 1,200

Input SGST A/c Dr. 1,200

To Bank A/c   22,400

(Machinery purchased with CGST and SGST @ 6% each paid)

2017

Jun 30

Bank A/c Dr. 43,120

To Machinery A/c 38,500

To Output IGST A/c 4,620

(Machinery purchased on 1st Aug, 2015 sold with IGST @ 12%.)

Cost is the amount of resources sacrificed in order to obtain certain goods or services. Money or its equivalent stated in monetary units are the resources forfeited.

Cost, according to the Chartered Institute of Management Accountants, London, is "the sum of

expenditure (real or hypothetical) made on or related to a certain item or activity.

This business activity could entail the creation of a good or the provision of a service, both of which need spending on a variety of things like labour, materials, and other costs. A firm that produces goods is interested in finding out how much each unit of the product costs to produce, while a company that provides services, such a transportation company, canteen, electricity provider, municipality, etc.,

To learn more about Accountants visit

brainly.in/question/8827659

brainly.in/question/34036409

#SPJ1