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An asset is purchased for ₹ 50,000. The rate of depreciation is 15% p.a. Calculate the annual depreciation for the first two years under the diminishing balance method.

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प्रश्न

An asset is purchased for ₹ 50,000. The rate of depreciation is 15% p.a. Calculate the annual depreciation for the first two years under the diminishing balance method.

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उत्तर

Calculation of depreciation of Machinery-

Cost of the assets 50,000
Less: Depreciation for 1st year at 15% as 5000 7,500
  42,500
Less: Depreciation for 2nd year at 15% as 42,500 6,375
Book Value 36,125
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अध्याय 10: Depreciation Accounting - Exercises [पृष्ठ २२६]

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सामाचीर कलवी Accountancy [English] Class 11 TN Board
अध्याय 10 Depreciation Accounting
Exercises | Q IV 11. | पृष्ठ २२६

संबंधित प्रश्न

Answer in One Sentence only:

Which account is credited when depreciation is charged?


Select the most appropriate answer from the alternatives given below and rewrite the sentence:

The amount of depreciation remains constant every year under ______


State whether the following statement is True or False with reasons:

Wages paid for installation of Machinery are debited to Wages A/c.


State whether the following statement is True or False with reasons:

Depreciation is charged on Current Assets only.


Depreciation is to be calculated from the date when ______.


Correct the following statement and rewrite the statement.

Underwritten down value method depreciation is calculated on the original cost of an asset.


On 1st July 2016 M/s. Ramai & Co. .sold Machinery for ₹ 7,000 the original cost of ₹ 10,000 which was purchased on 18th April 2015. Find out the profit or loss on sale of Machinery by charging depreciation at 10% p.a. on original cost on 31st March every year.


Shubhangi Trading Company of Dombivli purchased Machinery for ₹ 86,000 on 1st January 2016 and immediately spent ₹ 4,000 on its fixation and erection. On 1st October 2016 additional Machinery costing ₹ 40,000 was purchased.

On 1st October 2017, the Machinery purchased on 1st January 2016 became obsolete and was sold for ₹ 70,000. On 1st July 2017, a new Machine was also purchased for ₹ 45,000.

Depreciation was provided annually on 31st March at the rate of 12% per annum on the fixed installment method.
Prepare Machinery Account for three years and pass Journal Entries for the Third year i.e. 2017-2018.


On 1st April 2015, Farid of Nasik purchased a Motor Car for ₹ 55,000. The scrap value of the Motor Car was estimated at ₹ 10,000 and its estimated life is 10 years. The Registration charge for the Motor Car was ₹ 5,000.

Show Motor Car Account for first four years, assuming that the books of accounts are closed on 31st March every year.


On 1st April 2015, Farid of Nasik purchased a Motor Car for ₹ 55,000. The scrap value of the Motor Car was estimated at ₹ 10,000 and its estimated life is 10 years. The Registration charge for the Motor Car was ₹ 5,000.

Show Motor Car Account for first four years, assuming that the books of accounts are closed on 31st March every year.


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