Question 13:
A Van was purchased on 1st April, 2021 for `60,000 and `5,000 was spent on its repair and registration. On 1st October, 2022 another van was purchased for `70,000. On 1st April, 2023, the first van purchased on 1st April, 2021 was sold for `45,000 and a new van costing `1,70,000 was purchased on the same date. Show the Van Account from 2021-22 to 2023-24 on the basis of Straight Line Method, if the rate of Depreciation charged is 10% p.a. Assume that books are closed on 31st March every year.
Answer:
|
Van
Account |
||||||||||
|
Dr. |
|
Cr. |
||||||||
|
Date |
Particulars |
J.F. |
(`) |
Date |
Particulars |
J.F. |
(`) |
|||
|
2021 |
|
|
|
2021 |
|
|
|
|||
|
April 01 |
Bank A/c (I) |
|
65,000 |
March 31 |
Depreciation A/c
(I) |
|
6,500 |
|||
|
|
|
|
|
March 31 |
Balance c/d (I) |
|
58,500 |
|||
|
|
|
|
65,000 |
|
|
|
65,000 |
|||
|
2021 |
|
|
|
2022 |
|
|
|
|||
|
April 01 |
Balance b/d (I) |
|
58,500 |
March 31 |
Depreciation A/c |
|
|
|||
|
Oct. 01 |
Bank A/c (II) |
|
70,000 |
|
(I) |
6,500 |
|
|
||
|
|
|
|
|
|
(II) (for 6 month) |
3,500 |
|
10,000 |
||
|
|
|
|
|
March 31 |
Balance c/d |
|
|
|||
|
|
|
|
|
|
(I) |
52,000 |
|
|
||
|
|
|
|
|
|
(II) |
66,500 |
|
1,18,500 |
||
|
|
|
|
1,28,500 |
|
|
|
1,28,500 |
|||
|
2022 |
|
|
|
2022 |
|
|
|
|||
|
April 01 |
Balance b/d |
|
|
April 01 |
Bank A/c (I) |
|
45,000 |
|||
|
|
(I) |
52,000 |
|
|
April 01 |
Profit and Loss
A/c (Loss on Sale) |
|
7,000 |
||
|
|
|
|
|
|
2023 |
|
|
|
||
|
|
(II) |
66,500 |
|
1,18,500 |
March 31 |
Depreciation A/c |
|
|
||
|
April 01 |
Bank A/c (III) |
|
1,70,000 |
|
(II) |
7,000 |
|
|
||
|
|
|
|
|
|
(III) |
17,000 |
|
24,000 |
||
|
|
|
|
|
March 31 |
Balance c/d |
|
|
|||
|
|
|
|
|
|
(II) |
59,500 |
|
|
||
|
|
|
|
|
|
(III) |
1,53,000 |
|
2,12,500 |
||
|
|
|
|
2,88,500 |
|
|
|
2,88,500 |
|||
|
|
|
|
|
|
|
|
|
|||
Working Notes
1. Calculation of Annual Depreciation
Maruti
Van (1) = 65,000×10/100= `6,500
Maruti
Van (1I) = 70,000×10/100= `7,000
Maruti Van (1II) =1,70,000×10/100= `17,000
2. Calculation of profit or loss on
sale of Van (I)
|
Particulars |
(`) |
|
Book Value on Apr. 01, 2022 |
52,000 |
|
Less: Sale of Van |
(45,000) |
|
Loss on Sale of
Van |
7,000 |
Question 14:
Mahima Traders purchased a second-hand machine for ₹5,00,000 and spent ₹1,00,000 on its repairs. Depreciation is to be provided @ 10% p.a. as per Straight Line Method. This machine is sold for ₹4,50,000. Accounting year is financial year. Calculate profit or loss on sale of machine in each of the following alternative cases:
|
Case |
Date of
Purchase |
Date of
Sale |
Case |
Date of
Purchase |
Date of
Sale |
|
(a) |
1st April,
2022 |
31st
March, 2025 |
(b) |
1st April,
2022 |
30th
Sept., 2024 |
|
(c) |
1st July,
2022 |
31st
March, 2025 |
(d) |
1st July,
2022 |
30th
Sept., 2024 |
Answer:
Case (a):
Depreciation from 1st April, 2022 to 31st March, 2025 for 3 years
Cost of machine 5,00,000 + 1,00,000 = 6,00,000
Annual depreciation = 5,00,000×10 / 100 = 60,000
Depreciation for 3 years is 60,000 × 3 = 1,80,000
Net book value of the machine on 31st March, 2025 = ₹6,00,000 -₹1,80,000= ₹4,20,000
Profit on sale of machine = sale price - book value
Profit on sale of machine = ₹4,50,000
– ₹4,20,000 = ₹30,000
Case (b):
Depreciation from 1st April, 2022 to 30th Sept., 2024 for 2.5 years
Cost of machine 5,00,000 + 1,00,000 = 6,00,000
Annual depreciation = 5,00,000×10 / 100 = 60,000
Depreciation for 2.5 years is 60,000 × 5 = 1,50,000
Net book value of the machine on 31st March, 2024 = ₹6,00,000 -₹1,50,000= ₹4,50,000
Profit on sale of machine = book value - sale price
Profit / Loss on sale of machine = ₹4,50,000 – ₹4,50,000 = Nil
Case (c):
Depreciation from 1st July, 2022 to 31st March, 2025 for 2 years 9 months (33 Months)
Cost of machine 5,00,000 + 1,00,000 = 6,00,000
Annual depreciation = 5,00,000×10 / 100 = 60,000
Depreciation for 33 Months is 60,000/ 12 × 33 = 1,65,000
Net book value of the machine on 31st March, 2024 = ₹6,00,000 -₹1,65,000= ₹4,35,000
Profit on sale of machine = book value - sale price
Profit on sale of machine = ₹4,50,000
– ₹4,35,000 = 15,000
Case (d):
Depreciation from 1st July, 2022 to 30th Sept., 2024 for 2 years 3 months (27 Months)
Cost of machine 5,00,000 + 1,00,000 = 6,00,000
Annual depreciation = 5,00,000×10/100 = 60,000
Depreciation for 33 Months is 60,000/12 × 27 = 1,35,000
Net book value of the machine on 31st March, 2024 = ₹6,00,000 -₹1,35,000= ₹4,65,000
Loss on sale of machine = Book Value-Sale Price
Loss on sale of machine = ₹4,65,0000
– ₹4,50,000 = 15,000
Question 15:
A company whose accounting year is
a financial year, purchased on 1st July, 2022 machinery costing `30,000. It purchased
further machinery on 1st January, 2023 costing
`20,000 and on 1st October, 2023 costing
`10,000. On 1st April, 2024, one-third of the machinery installed on 1st
July, 2022 became obsolete and was sold for
`3,000.
Show how Machinery Account would appear in the books of the company. It being
given that machinery was depreciated by Fixed Installment Method at 10% p.a.
What would be the value of Machinery Account on 1st April, 2025?
Answer:
|
Date |
Particulars |
|
J.F. |
(`) |
Date |
Particulars |
|
J.F. |
(`) |
|
2021 |
|
|
|
|
2022 |
|
|
|
|
|
July 01 |
Bank (I) |
|
|
30,000 |
March 31 |
Depreciation |
|
|
|
|
2021 |
|
|
|
|
|
I (for 9 months) |
2,250 |
|
|
|
Jan. 01 |
Bank (II) |
|
|
20,000 |
|
II |
500 |
|
2,750 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
March 31 |
Balanced c/d |
|
|
|
|
|
|
|
|
|
|
I |
27,750 |
|
|
|
|
|
|
|
|
|
II |
19,500 |
|
47,250 |
|
|
|
|
|
50,000 |
|
|
|
|
50,000 |
|
2022 |
|
|
|
|
2023 |
|
|
|
|
|
April
01 |
Balance b/d |
|
|
|
March 31 |
Depreciation |
|
|
|
|
|
I |
27,750 |
|
|
|
I |
3,000 |
|
|
|
|
II |
19,500 |
|
47,250 |
|
II |
2,000 |
|
|
|
|
|
|
|
|
|
III |
500 |
|
5,500 |
|
Oct. 01 |
Bank (III) |
|
|
10,000 |
March 31 |
Balance c/d |
|
|
|
|
|
|
|
|
|
|
I |
24,750 |
|
|
|
|
|
|
|
|
|
II |
17,500 |
|
|
|
|
|
|
|
|
|
III |
9,500 |
|
51,750 |
|
|
|
|
|
57,250 |
|
|
|
|
57,250 |
|
2023 |
Balance b/d |
|
|
|
2023 |
|
|
|
|
|
April
01 |
I |
24,750 |
|
|
April 01 |
Bank I(1/3rd
portion) |
|
|
3,000 |
|
|
II |
17,500 |
|
|
April 01 |
Profit and Loss (Loss on Sale of I) |
|
|
5,250 |
|
|
III |
9,500 |
|
51,750 |
2025 |
|
|
|
|
|
|
|
|
|
|
March 31 |
Depreciation |
|
|
|
|
|
|
|
|
|
|
I (on 2/3rd portion) |
2,000 |
|
|
|
|
|
|
|
|
|
II |
2,000 |
|
|
|
|
|
|
|
|
|
III |
1,000 |
|
5,000 |
|
|
|
|
|
|
March 31 |
Balance c/d |
|
|
|
|
|
|
|
|
|
|
I (on 2/3rd portion) |
14,500 |
|
|
|
|
|
|
|
|
|
II |
15,500 |
|
|
|
|
|
|
|
|
|
III |
8,500 |
|
38,500 |
|
|
|
|
|
51,750 |
|
|
|
|
51,750 |
Working Notes
1. Calculation of Depreciation
Machine
1=30,000×10/100= `3,000
And
Drepreciation of 2/3rd
proportion=3,000×2/3= `2,000
Machine
II =20,000×10/100= `2,000p.a.
Machine
III =10,000×10/100= `1,000p.a.
Calculation of profit or loss on sale of 1/3rd Portion of Machine I
|
Particulars |
(`) |
|
Book Value of
1/3rd portion of Machine I on April 01, 2023 (24,750 × 1/3) |
8,250 |
|
Less: Sale Value |
(3,000) |
|
Loss on sale |
5,250 |
Question 16:
On 1st July, 2021, Alpha Ltd. purchases second-hand machinery for `20,000 and spends `3,000 on
reconditioning and installing it. On 1st January, 2022, the firm purchases new
machinery worth `12,000.
On 30th June, 2023, the machinery purchased on 1st January, 2022, was sold for `8,000 and on 1st
July, 2023, a fresh plant was installed.
Payments for this plant was to be made as follows:
|
1st
July, 2023 |
`5,000 |
|
30th
June, 2024 |
`6,000 |
|
30th
June, 2025 |
`5,500 |
Payments
in 2024 and 2025 include interest of `1,000 and `500 respectively.
The company writes off 10% p.a. on the original cost. The accounts are closed
every year on 31st March. Show the Machinery Account for the year ended 31st
March, 2024.
Answer:
Books of Alpha Ltd
Machinery A/c
|
||||||||||
|
Date |
Particulars |
J.F. |
(`) |
Date |
Particulars |
J.F. |
(`) |
|||
|
|
|
|
|
|
2021 |
|
|
|
|
|
|
2020 |
|
|
|
|
Mar.31 |
Depreciation |
|
|
|
|
|
July 01 |
Bank (I) (20,000 + 3,000) |
|
23,000 |
|
I (for 9 months) |
1,725 |
|
|
||
|
2020 |
|
|
|
|
|
II (for 3 months) |
300 |
|
2,025 |
|
|
Jan.01 |
Bank (II) |
|
|
12,000 |
Mar.31 |
Balance c/d |
|
|
|
|
|
|
|
|
|
|
|
I |
21,275 |
|
|
|
|
|
|
|
|
|
|
II |
11,700 |
|
32,975 |
|
|
|
|
|
|
35,000 |
|
|
|
|
35,000 |
|
|
2021 April
01 |
Balance b/d |
|
|
|
2022 |
|
|
|
|
|
|
|
I |
21,275 |
|
|
Mar.31 |
Depreciation |
|
|
|
|
|
|
II |
11,700 |
|
32,975 |
|
I |
2,300 |
|
|
|
|
|
|
|
|
|
|
II |
1,200 |
|
3,500 |
|
|
|
|
|
|
|
Mar.31 |
Balance c/d |
|
|
|
|
|
|
|
|
|
|
|
I |
18,975 |
|
|
|
|
|
|
|
|
|
|
II |
10,500 |
|
29,475 |
|
|
|
|
|
|
32,975 |
|
|
|
|
32,975 |
|
|
2022 |
|
|
|
|
2022 |
|
|
|
|
|
|
April
01 |
Balance b/d |
|
|
|
June
30 |
Bank (II) |
|
|
8,000 |
|
|
|
I |
18,975 |
|
|
June
30 |
Depreciation (II) (for 3 months) |
|
|
300 |
|
|
|
II |
10,500 |
|
29,475 |
June
30 |
Profit and Loss (Loss) |
|
|
2,200 |
|
|
July 01 |
Bank (III) |
|
|
5,000 |
2023 |
|
|
|
|
|
|
July 01 |
Creditors for plant (III) |
|
|
10,000 |
Mar.31 |
Depreciation |
|
|
|
|
|
|
|
|
|
|
|
I |
2,300 |
|
|
|
|
|
|
|
|
|
|
III (on 15,000 for 8 months) |
1,125 |
|
3,425 |
|
|
|
|
|
|
|
|
Balance c/d |
|
|
|
|
|
|
|
|
|
|
|
I |
16,675 |
|
|
|
|
|
|
|
|
|
|
III |
13,875 |
|
30,550 |
|
|
|
|
|
|
44,475 |
|
|
|
|
44,475 |
|
Working Notes
1. Calculation of Depreciation
Machine I= 23,000×10/100= `2,300 p.a.
Machine II=12,000×10/100= `1,200 p.a.
Machine III=15,000×10/100= `1,500 p.a.
2. Calculation
of profit on loss on sale of Machine (II)
|
Particulars |
(Rs) |
|
Book Value of
Machine (II) on April 01, 2022 |
10,500 |
|
Less: Depreciation for 3
Months |
(300) |
|
Book Value on
June 30 |
10,200 |
|
Less: Sale |
(8,000) |
|
Loss on Sale |
2,200 |
Click below for more Questions
Ts Grewal Solution 2025-2026
Class 11th