Related InterviewSolutions

• Ganga Ltd. purchased a machinery on January 01, 2014 for `Rs.` 5,50,000 and spent `Rs.` 50,000 on its installation. On September 01, 2014 it purchased another machine for `Rs` 3,70,000.On May 01,2015 it purchased another machine for `Rs. 8,40,000 ( including installation expenses). (a) Machinery account and depreciation account for the years 2014, 2015, 2016 and 2017. (b) If depreciation is accumulated in provision for Depreciation account then prepare machine account and provision for depreciation account for the years 2014, 2015, 2016 and 2017.
• The following balances appear in the books of Crystal Ltd, on Jan 01, 2015 `{:(,Rs.),("Machinery account on " , "15,00,000"),("Provision for depreciation account ","5,500"):}` On April 01, 2015 a machinery which was purchased on January 01, 2012 for `Rs`. 2,00,000 was sold for `Rs`. 75,000. A new machine was purchased on July 01, 2015 for `Rs`. 6,00,000, Depreciation is provided on machinery at `20%` p.a. on Straight line method and books are closed on December 31 every year. Prepare the machinery account and provision for depreciation account for the year ending December 31, 2015.
• Complete the following sentence :(i) ___________ is the major cause for Depreciation.(ii) Depreciation is _________ to the business.(iii) Depreciation is necessary to make provision for _________ of old assets.(iv) Depreciation enables the business to compute and pay the correct amount of _________ to the Government.(v) ___________ cost concept is use for depreciation of Assets.
• M/s Sitaram and Co Purchased a Machinery on 1st January 2016 for ₹ 2,00,000. The company provides depreciation @ 10% p.a. on Reducing Balance Method on 31st March every year. Calculate Written Down Value of Machinery as of 31st March 2017.
• State whether the following statement are True or False with reason :Under the Reducing Balance, method depreciation is charged on the original cost.
• If the cost of the Computer is ₹ 40,000 and depreciation is to be charged at 8% p.a.Calculate the amount of depreciation.
• A machine costing ₹ 23,000 is estimated to have a life of 7 years and the scrap value is estimated at ₹ 2,000 at the end of its useful life. Find out the amount of depreciation p.a.
• On October 01, 2011 Juneja Transport Company purchased 2 Trucks for `Rs.` 10,00,000 each. On July 01, 2013, One Truck was involved in an accident and was completely destroyed and `Rs.` 6,00,000. were recived from the insurance company in full settlement. On December 31, 2013 another truck was involved in an accident and destroyed partially, which was not insured. It was sold off for `Rs.` 1,50,000. On Jaunuary 31, 2014 company purchased a fresh truck for value every year. The books are closed every year on March 31. Give the truck account from 2011 to 2014
• On January 01, 2011, Satkar Transport Ltd., purchased 3 buses for `Rs.` 10,00,000 each/ On July 01, 2013, one bus was involved in an accident and was completely destroyed and `Rs.` 7,00,000 were recived from the Insurance Company in full settlement. Depreciation is written off @`15%` p.a. on diminishing balance method. Prepare bus account from 2011 to 2014. Books are closed on December 31 every year.
• On July 01, 2011 Ashwani purchased a machine for `Rs.` 2,00,000 on credit Installation expenses `Rs.` 25,000 are paid by cheque. The estimated life is 5 years and its scrap value after 5 years will be `Rs.` 20,000. Depreciation is to be charged on straight line basis. Show the journal entry for the year 2011 and prepare necessary ledger accounts for first three years.