Q.2 A company purchase 5 trucks 200000/- Each. After 3 year A truck will be sold by
company 87500/-.
Company charged depreciation @10% PA by diminishing balance method
Prepare truck account for first 5 years
Answers
Answer:
Answer :
Dr Truck Account Cr
Date Particulars JF Amt.(Rs) Date Particulars JF Amt.(Rs)
2001 Apr 1 To Bank A/c 10,00,000 2001 Dec 31 By Balance c/d 10,00,000
10,00,000 10,00,000
2002 Jan 1 To Balance b/d 10,00,000 2002 Dec 31 By Balance c/d 10,00,000
10,00,000 10,00,000
2003 Jan 1 To Balance b/d (T1) 10,00,000 2003 Oct 1 By Truck Disposal A/c 20,00,000
Oct 1 To Bank A/c (T2) 1,20,000 Dec 31 By Balance c/d 9,20,000
11,20,000 11,20,000
Dr Provision for Depreciation Account Cr
Date Particulars JF Amt.(Rs) Date Particulars JF Amt.(Rs)
2001 Dec 31 To Balance c/d 1,50,000 2001 Dec 31 By Depreciation A/c 1,50,000
1,50,000 1,50,000
2002 Dec 31 To Balance c/d 3,50,000 2002 Jan 1 By Balance b/d 1,50,000
Dec 31 By Depreciation A/c 2,00,000
3,50,000 3,50,000
2003 Oct 1 To Trunk Disposal A/c 1,00,000 2003 Jan 1 By Balance b/d 3,50,000
Dec 31 To Balance c/d 4,46,000 Oct 31 By Depreciation A/c (Dep till Oct 9 months) 30,000
Dec 31 By Depreciation A/c (Old)(T1) 1,60,000
(New)(T2) = 6,000
1,66,000
5,46,000 5,46,000
Dr Truck Disposal Account Cr
Date Particulars JF Amt.(Rs) Date Particulars JF Amt.(Rs)
2003 Oct 1 To Truck A/c 2,00,000 2003 Oct 1 By Provision for Depreciation A/c 1,00,000
Oct 1 By Insurance Co (Claim Amount) 70,000
Oct 1 By Profit & Loss A/c (Loss on Sale) 30,000
2,00,000 2,00,000
Working Note
Total Depreciation Charged on Truck @ 20%
Dec 2001 = 30,000
Dec 2002 = 40,000
Oct 2003 = 30,000
Rs.1,00,000
Cost of truck at disposal = 2,00,000−1,00,000=Rs.1,00,000
Profit or Loss on sales of truck
= 1,00,000−70,000=Rs.30,000 (Loss)