Question

Diminishing
BALANCE METHOD
A company purchased a plant for 60,000 on 1st Jan., 2016. It is estimated that
scrap value
of this plant at the end of its working life of 12 years will be * 12,420. Depreciation is to be
provided @ 10% p.a. by 'Diminishing Balance Method'.
Prepare Plant Account for 4 years assuming that books are closed on 31st December each
(Ans. Balance of Plant A/c on 31st Dec. 2019, 39,366)

Answer 1

Answer:

I do not know what is accountry sorry

Answer 2

Given:

Plant purchased for ₹60,000.

Rate of depreciation 10 percent per annum.

To find:

Prepare a plant account using written down value or diminishing balance method.

Explanation:

• The rate of depreciation is based on the asset's decreasing value. The reducing balance approach is another name for it.  In the diminishing balance approach, the reducing balance is used to calculate depreciation. Book value is another term for reducing balance.

• Purchases should be debited in the plant account with cash or a bank account. Purchased plant depreciation (on book value) should be reflected in the plant account's credit side. The balance amount must be carried over to the following year.