Question

Discon Ltd. Purchased machinery for Rs.1,00,000 on 1st July, 2004. The asset was depreciated at the rate of 10% p.a. on written down value basis. The machinery was sold on 1st January 2008, for Rs.56,500. Show the Machinery Accounts assuming accounting year ending on 30th June every year. What is the amount of depreciation charges during the year ended 30th June 2006? *

Answer 1

Answer:

Correct option is

A

Rs1,00,000

WDV on 31st march 2013 = RS-72900 x 100/90

                                          = RS-81,000

WDV on 31st march 2012 = RS-81,000 x 100/90

                                          = RS-90,000.

Value on 1st April 2013     = RS-90,000 x 100/90

                                           = RS-1,00,000.