Question

Question 5.
From the following transactions of a concern, prepare the Machinery Account for the year ended 31st March, 2018:
1st April, 2017 : Purchased a second-hand machinery for ₹ 40,000
1st April, 2017 : Spent ₹ 10,000 on repairs for making it serviceable.
30th September, 2017 : Purchased additional new machinery for ₹ 20,000.
31st December, 2017 : Repairs and renewals of machinery ₹ 3,000.
31st March, 2018 : Depreciate the machinery at 10% p.a.

Answer 1

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Answer 2

The machinery account is shown below:

Explanation:

The machinery account is as:

NOTE: Repair and renewal charges are incurred in same day. So, they have been added in the cost of machinery. But after the purchasing date, expense on machinery will not be recorded in machinery account.