Question

old machinery having the book value of rupees 140000 is exchange for a new machinery of rupees 250000 from abc machines Amritsar journalise the above entry in the books of M/s Traders Delhi( CGST, SGST 6 percent each and IGST is @12percent)​

Answer 1

Answer:

Machinery a/c. Dr. 250000

To machinery a/c 140000

To Usha trader's a/c. 90000

To profit and loss a/c. 10000

Explanation:

machinery costing ₹250000 purchased and it's an asset so it will be debited and our old machinery costing ₹140000 goes out so it will be credited we purchase new machinery from usha trader at credit so liability increases so it will be credited and we received a profit of 10000 and all profits are credited