On 1st April, 2000 Z ltd. purchased machinery for Rs390000 on which they spent Rs.5000 for
carriage, Rs2000 for brokerage, Rs2500 for installation and Rs.500 for iron pad. On 1st November, 2001
they purchased another machinery for Rs120000. On 30th September, 2002 the machinery purchased in
2000 was sold for Rs 110000 . The company charge depreciation @10% p.a. on straight line method.
Accounts are closed on 31st march every year.
Prepare machinery account and depreciation account up to 31st march 2003.
Answers
Answer:
Give Machine Account and Depreciation A/c in the books of the Company for 4 years after providing depreciation by Fixed Installment Method. The books are closed on 31st March every year.
Explanation:
On 1st April, 2007, a limited company purchased a Machine for ₹ 1,90,000 and spent ₹ 10,000 on its installation. At the date of purchase, it was estimatDate Particulars Amount (Rs) Date Particulars Amount (Rs)
2007 2008
Apr. 01 Bank A/c (1,90,000 + 10,000) 2,00,000 Mar. 31 Depreciation A/c 25,000
Mar. 31 Balance c/d 1,75,000
2,00,000 2,00,000
2008 2009
Apr. 01 Balance b/d 1,75,000 Mar. 31 Depreciation A/c 25,000
Mar. 31 Balance c/d 1,50,000
1,75,000 1,75,000
2009 2010
Apr. 01 Balance b/d 1,50,000 Mar. 31 Depreciation A/c 25,000
Mar. 31 Balance c/d 1,25,000
1,50,000 1,50,000
2010 2011
Apr. 01 Balance b/d 1,25,000 Mar. 31 Depreciation A/c 25,000
Mar. 31 Balance c/d 1,00,000
1,25,000 1,25,000
that the scrap value of the machine would be 50,000 at the end of sixth year.
Give Machine Account and Depreciation A/c in the books of the Company for 4 years after providing depreciation by Fixed Installment Method. The books are closed on 31st March every year.