Question

on 1 january 2016 the balance of machinery account was ₹ 97200. on 1st july 2016 a new machinery was purchased for ₹48000. the installation expenses were ₹2000. on 1st september 2016, an old machine was sold for ₹12000( the original cost of which was ₹20000 on 1st jan 2014).machinery is depriciated at 10% p.a. under the diminishing balance method. the books are closed on december 31st every year.you are required to calculate the profit and loss on sale of machinery and amount of annual depreciation for the year 2016​

Answer 1

Answer:

on 1 january 2016 the balance of machinery account was ₹ 97200. on 1st july 2016 a new machinery was purchased for ₹48000. the installation expenses were ₹2000. on 1st september 2016, an old machine was sold for ₹12000( the original cost of which was ₹20000 on 1st jan 2014).machinery is depriciated at 10% p.a. under the diminishing balance method. the books are closed on december 31st every year.you are required to calculate the profit and loss on sale of machinery and amount of annual depreciation for the year 2016