M/s J. P. Company, Sakri, purchased a motor lorry for Rs. 8,00,000 on 1st April, 2007. Company purchased a second-hand motor lorry for Rs. 3,60,000 on 1st October, 2008. The company charges depreciation @ 10% p.a. on original cost. The financial year of the company ends on 31st March every year. On 30th September 2009, the second-hand motor lorry was sold for Rs. 2,80,000. Prepare: Motor Lorry's Account for the years 2007-2008, 2008-2009 and 2009-2010 and Journal Entries for the year 2009-2010.
Concept: Effects of Adjustments-Depreciation