Question 17.
A Limited has the following balances on 1st April, 2017:
Machinery A/c – ₹ 2,00,000
Provision for Depreciation A/c – ₹ 90,000
The company charged depreciation @ 10% p.a. on Straight Line Method. Accounts are closed on 31st March every year. On 1st October, 2017, a part of machinery purchased on 1st July, 2014 for ₹ 40,000 was sold for ₹ 18,400, charging CGST and SGST @ 6% each and on the same date a new plant was purchased for ₹ 1,00,000 plus IGST @ 12%.
Prepare Machinery Account and Provision for Depreciation Account for the year ended 31st March, 2018.
Answers
Answer:
Explanation:
Output CGST A/c
To balance c/d 1104 By sales a/c 1104
1104 1104
Output SGST A/c
To Balance c/d 1104 By Sales 1104
1104 1104
Working Notes
1.Original cost of machinery = 40000
Less accumalated Depreciation (13000)
Book value of machine = 27000
Less Sale of machine = 18400
Loss on sale of machine = 8600
2. Calculation of depreciation
On 160000 @ 10 % 16000
On 100000@10 % for 6 months 5000
On 40000 @ 10 % 2000
To tal = 23000