Question

what would be the treatment when a fixed asset is sold for rs 70000 whose cost was rs 90000 & WDV 60000?
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Answer 1

Answer:

WDV of machinery is 60000

Machinery sold for rs 70000

selling price is more than WDV so there is profit on sale of machinery is 70000-60000=10000

At the time of sale of machinery following entry will passed

Bank account. dr 70000

To Machinery account 60000

To statement of profit &loss 10000