Advertisements
Advertisements
प्रश्न
Furniture costing ₹ 5,000 was purchased on 1.1.2016, the installation charges being ₹ 1,000. The furniture is to be depreciated @ 10% p.a. on the diminishing balance method. Pass journal entries for the first two years.
Advertisements
उत्तर
| Date | Particulars | ₹ |
| 01.01.2016 | Furniture purchased | 5,000 |
| Add: Installation charges | 1,000 | |
| Total cost or original cost | 6000 | |
| 31.12.2016 | Less: Depreciation 10% | 600 |
| 01.01.2017 | Book Value | 5,400 |
| 31.12.2017 | Less: Depreciation 10% | 540 |
| 01.01.2018 | Book value | 4,860 |
Journal Entries
| Date | Particulars | L.F. | Dr. (₹) | Cr. (₹) |
| 1.1.2016 | Furniture A/c Dr. To Bank A/c [Furniture bought] |
5,000 | 5,000 | |
| 1.1.2016 | Furniture A/c Dr. To Bank A/c [Installation charges cost incurred on purchases of furniture] |
1,000 | 1,000 | |
| 31.12.2016 | Depreciation A/c Dr. To Furniture A/c [Depreciation provided] |
600 | 600 | |
| 31.12.2016 | Profit and loss A/c Dr. To Depreciation A/c [Depreciation Transferred to P/C A/c] |
600 | 600 | |
| 31.12.2017 | Depreciation A/c Dr. To Furniture A/c [Depreciation provided] |
540 | 540 | |
| 31.12.2017 | Profit and loss A/c Dr. To Depreciation A/c [Depreciation Transferred to P/C A/c] |
540 | 540 |
APPEARS IN
संबंधित प्रश्न
State whether the following statement is True or False with reasons:
Depreciation is charged on fixed assets.
Complete the following sentence:
Depreciation = `"Cost of asset - _____________"/"Estimated Working Life of the Asset"`
State the limitations of written down value method of depreciation.
A company purchased a building for ₹ 50,000. The useful life of the building is 10 years and the residual value is ₹ 5,000. Find out the amount and rate of depreciation under the straight-line method.
Calculate the rate of depreciation under straight-line method from the following information:
Purchased second-hand machinery on 1.1.2018 for ₹ 38,000
On 1.1.2018 spent ₹ 12,000 on its repairs
Expected useful life of the machine is 4 years
Estimated residual value ₹ 6,000.
On 1st October 2014, a truck was purchased for ₹ 8,00,000 by Laxmi Transports Ltd. Depreciation was provided @ 15% p.a. under diminishing balance method. On 31st March 2017, the above truck was sold for ₹ 5,00,000. Accounts are closed on 31st March every year. Find out the profit or loss made on the sale of the truck.
Samarth Manufacturing Co. Ltd, Aurangabad, purchased a New Machinery for ₹ 45,000 on 1st Jan 2015 and immediately spent ₹ 5,000 on its fixation and erection. In the same year, 1st July additional Machinery costing ₹ 25,000 was purchased. On 1st July 2016, the Machinery purchased on 1st Jan 2015 became obsolete and was sold for ₹ 40,000.
Depreciation was provided annually on 31st March at the rate of 10% per annum on the Fixed Instalment Method.
You are required to prepare Machinery Account for the year 2014-15, 2015-16, 2016-17.
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.
M/s Omkar Enterprise Jalgaon acquired a Printing Machine for ₹75,000 on 1 Oct 2015 and spent ₹5,000 on its transport and installation. Another Machine for ₹45,000 was purchased on 1st Jan 2017. Depreciation is charged at the rate of 20% on the Written Down Value Method, on 31st March every year.
Prepare Printing Machine Account for the first four years.
Under which method might two identical machines purchased at the same cost show different depreciation expenses in two companies?
