Question

On 1st April, 2013 the Jindal Traders Ltd. took delivery of one Truck from Hind Motors Ltd. on Hire-Purchase
Agreement, payable in three equal instalments of 60,000 each on 31st March, 2014, 2015, 2016. The east
value of the Truck on delivery was 1,63,400. Vendor charges interest at 5 per cent per annum on the yearly
balance The purchase write off 25 per cent on the diminishing value as depreciation for each year to 31s
March Pass the necessary Journal entries to record the above transactions in the books of both the parties.

Answer 1

Answer: interest 1st year 8170, 2nd year 5579, 3td year 2851.

Calculation of Dep...

1st year 40850

2nd year 30636

3td year 22978

Explanation: calculation of interest 163400*5/100=8170

1st year installment=60000-8170=

51830(CP)

2nd year 163400-51830=111570*5/100=5579

Installment=60000-5579=54421

3td year 111570-54421=57149

Interest 60000-57149=2851

Answer 2

Explanation:

this the soloustion

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