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प्रश्न
Furniture was purchased for ₹ 1,00,000 on 1.7.2016. It is expected to last for 5 years. Estimated scrap at the end of five years is ₹ 10,000. Find out the rate of depreciation under the straight-line method.
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उत्तर
Original cost = ₹ 1,00,000
Scrap value = ₹ 10,000
Estimated life = 5 years
Amount of depreciation = `("Original cost" - "Scrap value")/"Estimates life"`
`= (1,00,000 - 10,000)/(5 "years")`
`= (90,000)/5`
= ₹ 18,000
Rate of depreciation = `"Amount of depreciaton"/"Original cost" xx 100`
`= (18,000)/(1,00,000) xx 100`
= 18 %
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संबंधित प्रश्न
Answer in One Sentence only:
What is the formula to calculate depreciation by Straight Line Method?
State whether the following statement is True or False with reasons:
Wages paid for installation of Machinery are debited to Wages A/c.
Do you agree or disagree with the following statement:
By charging depreciation on fixed assets ascertainment of true and fair financial position is possible.
Complete the following sentence:
Depreciation = `"Cost of asset - _____________"/"Estimated Working Life of the Asset"`
Complete the following sentence:
The amount spent on installation of Machinery is a ______ expenditure.
State the limitations of written down value method of depreciation.
Mr. ‘X’ purchased Furniture on 1st October 2015 at ₹ 2,80,000 and spent ₹ 20,000 on its installation. He provides depreciation at 6% under the straight-line method on 31st March 2016. Calculate the amount of depreciation.
Radhika-Masale’ Amravati purchased a Plant on 1st Jan. 2015 for ₹ 80,000. A new Plant was also purchased
for ₹ 60,000, installation expenses being ₹ 10,000 on 1st April 2016. On 1st Jan 2017, a new Plant was purchased for ₹ 20,000, by disposing of the 1st Plant at ₹ 60,000.
Prepare Plant Account and Depreciation Account for 31st March 2015, 31st March 2016, and 31st March 2017, assuming that the rate of depreciation was @ 10% on Diminishing Balance Method.
Solution:
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 charges of 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.
