Marmik purchased a motor car on
Hire-purchase system on 1st April by
paying Rs. 60,000 against delivery. He
paid the balance in four instalments at
the end of each year on 31st March
including interest at 10% p.a. on cash
price as follows : Rs. 1,28,000, Rs.
98,000, Rs. 70,000 and Rs. 44,000
respectively
He charged depreciation on motor car at
10% on diminishing balance method.
Prepare motor car A/C and Vendor's A/C
in the books of Marmik and state how
motor car will appear in the balance
sheet at the end of the third year.
Answers
Answer:
Marmik purchased a motor car on
Hire-purchase system on 1st April by
paying Rs. 60,000 against delivery. He
paid the balance in four instalments at
the end of each year on 31st March
including interest at 10% p.a. on cash
price as follows : Rs. 1,28,000, Rs.
98,000, Rs. 70,000 and Rs. 44,000
respectively
He charged depreciation on motor car at
10% on diminishing balance method.
Prepare motor car A/C and Vendor's A/C
in the books of Marmik and state how
motor car will appear in the balance
sheet at the end of the third year.
Answer:
Marmik purchased a motor car on
Hire-purchase system on 1st April by
paying Rs. 60,000 against delivery. He
paid the balance in four instalments at
the end of each year on 31st March
including interest at 10% p.a. on cash
price as follows : Rs. 1,28,000, Rs.
98,000, Rs. 70,000 and Rs. 44,000
respectively
He charged depreciation on motor car at
10% on diminishing balance method.
Prepare motor car A/C and Vendor's A/C
in the books of Marmik and state how
motor car will appear in the balance
sheet at the end of the third year.
Explanation:
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