Maharashtra State BoardHSC Commerce 12th Board Exam
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Shri Yashraj and Company, Kolhapur, Purchased Furniture for Rs 60,000 on 1.4.2007.On 1.10.2009 the Company Sold Out a Part of the Furniture for Rs 6,000, the Original Cost of Which on 1.4.2007 - Book Keeping and Accountancy

Shri Yashraj and Company, Kolhapur, purchased furniture for Rs 60,000 on 1.4.2007.On 1.10.2009 the company sold out a part of the furniture for Rs 6,000, the original cost of which on 1.4.2007 was Rs 12,000.

The company charges depreciation at the rate of 10% p.a. on Reducing Balance method. The financial year of the company ends on 31st March, every year.

Prepare: Furniture Account and Depreciation Account for the years 2007-08, 2008-09, 2009-10.

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Solution

In the books of Shri Yashraj and Company

Furniture Account

Dr.

 

Cr.

Date

Particulars

Amount

(Rs)

Date

Particulars

Amount

(Rs)

2007

 

 

2008

 

 

Apr. 01

Bank A/c

 

Mar. 31

Depreciation A/c

 

 

1/5 of F1

12,000

 

 

1/5 of F1

1,200

 

 

4/5 of F1

48,000

60,000

 

4/5 of F1

4,800

6,000

 

 

 

 

Balance c/d

 

 

 

 

 

1/5 of F1

10,800

 

 

 

 

 

4/5 of F1

43,200

54,000

 

 

60,000

 

 

60,000

2008

 

 

2009

 

 

Apr. 01

Balance b/d

 

Mar. 31

Depreciation A/c

 

 

1/5 of F1

10,800

 

 

1/5 of F1

1,080

 

 

4/5 of F1

43,200

54,000

 

4/5 of F1

4,320

5,400

 

 

 

 

Balance c/d

 

 

 

 

 

1/5 of F1

9,720

 

 

 

 

 

4/5 of F1

38,880

48,600

 

 

 

 

 

 

 

 

54,000

 

 

54,000

2009

 

 

2009

 

 

Apr. 01

Balance b/d

 

Oct. 01

Depreciation A/c (1/5 F1)

486

 

1/5 of F1

9,720

 

 

Bank A/c (Sale of 1/5 F1)

6,000

 

4/5 of F1

38,880

48,600

 

Profit & Loss A/c (Loss on Sale)

3,234

 

 

 

2010

 

 

 

 

 

Mar. 31

Depreciation A/c (4/5 F1)

3,888

 

 

 

 

Balance c/d (4/5 F1)

34,992

 

 

 

 

 

 

 

 

   48,600

 

 

48,600

 

Depreciation Account

Dr.

Cr.

Date

Particulars

Amount

(Rs)

Date

Particulars

Amount

(Rs)

2008

 

 

2008

 

 

Mar. 31

Furniture A/c

6,000

Mar. 31

Profit and Loss A/c

6,000

 

 

6,000

 

 

6,000

2009

 

 

2009

 

 

Mar. 31

Furniture A/c

5,400

Mar. 31

Profit and Loss A/c

5,400

 

 

5,400

 

 

5,400

2010

 

 

2010

 

 

Mar. 31

Furniture A/c
(486 + 3,888)

4,374

Mar. 31

Profit and Loss A/c

4,374

 

 

4,374

 

 

4,374

Working Notes:

WN1 Calculation of Profit or Loss on Sale

Particulars

Amount

Value of 1/5 of F1 as on April 01, 2009

9,720

Less: Depreciation for 6 months

486

Value of 1/5 of F1 as on Oct. 01, 2009

9,234

Less: Sale Value

6,000

Loss on Sale

3,234

WN2 Calculation of Depreciation

Year Depreciation on 1/5 of F1 Depreciation on 4/5 of F1
2007-08 1200 x `10/100`= Rs 1,200 48,000 x `10/100`= Rs 4,800
2008-09 10,800 x `10/100`=Rs 1,080 43,200 x `10/100`=Rs 4,320
2009-10 9,720 x `10/100`= Rs 486 38,880 x `10/100`= Rs 3,888
  Is there an error in this question or solution?
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