Question

On 1st October,2015, Ram & Bros. purchased a second-hand machine for Rs1,80,000 and spend 20,000 on its repair and installation. On 30th September,2018, the machinery was sold for 1,40,000 and an amount or 4,000 was paid for commission. The books are closed on 31st March every year and
depreciation is charged @10%p.a. on the written down value. Show Machinery Account from the date of machinery till the date of sale of machinery

Answer 1

Answer:

loss on sale of machinery = ₹6205

Explanation:

Calculation of loss on sale of machinery :

Value of machinery on 01/03/18 = ₹ 1,53,900

less : depreciation from 01/3/18 to 30/09/18 = ₹ 7695

value of machinery                        = ₹ 1,46,205

less : amount of sale                     = ₹ 1,40,000

  So, loss on sale of machinery    = ₹ 6,205

( full solution is attached below )