Question

Calculation of Cash Price by Back Calculation Method
11. A machinery is taken under the Hire Purchase System for 2,500 to be paid as follows: On delivery rs400
the end of first year rs 600; at the end of second year 400; at the end of third year 1,100. Intrest included in 2,500 being charged on the cash value at 10% per annum. Pass Journal entries in the book
hire purchaser writing off depreciation @ 5% per annum on Diminishing Balance Method.
Ans. Cash Price 7 2,103; Interest 170,127 and 100.
​

Answer 1

Answer:

Profit and loss a/c Dr. (total)

To Interest a/c ( balance of Interest

a/c )

To Depriciation a/c ( balance of

depriciation a/c )

Explanation:

plZ mark me as brainlist.