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On 1st April, 2015, Amit Kumar purchased five machines for ₹ 60,000 each. Depreciation 10% p.a. on initial cost has been charged from the Profit and Loss Account and credited to Provision for Depreciation Account.On 1st April, 2016, one machine was sold for ₹ 50,000 and on 1st April, 2017 another machine was sold for ₹ 50,000. An improved model costing ₹ 1,00,000 was purchased on 1st October, 2016. IGST was paid 12%. Amit Kumar closes his books on 31st March each year.You are required to show: (i) Machinery Account: (ii) Machinery Disposal Account and (iii) Provision for Depreciation Account for the period of three accounting years ended 31st March, 2018. |
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Answer» On 1st April, 2015, Amit Kumar purchased five machines for ₹ 60,000 each. Depreciation 10% p.a. on initial cost has been charged from the Profit and Loss Account and credited to Provision for Depreciation Account. On 1st April, 2016, one machine was sold for ₹ 50,000 and on 1st April, 2017 another machine was sold for ₹ 50,000. An improved model costing ₹ 1,00,000 was purchased on 1st October, 2016. IGST was paid 12%. Amit Kumar closes his books on 31st March each year. You are required to show: (i) Machinery Account: (ii) Machinery Disposal Account and (iii) Provision for Depreciation Account for the period of three accounting years ended 31st March, 2018. |
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