Question 25:
Following balances appear in the books of
M/s. Amrit as on 1st April, 2020:
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` |
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2020 |
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1st April |
Machinery
A/c |
60,000 |
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Provision
for Depreciation A/c |
36,000 |
On
1st April, 2020, they decided to dispose off a machinery
for `
8,400 which was purchased on 1st April, 2016 for ` 16,000.
You are required to prepare the Machinery Account, Provision for Depreciation
Account and Machinery Disposal Account for the year ended 31st March, 2021.
Depreciation was charged at 10% p.a on Cost following
Straight Line Method.
Answer:
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Books
of M/s. Amrit Machinery
Account |
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Dr. |
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Cr. |
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Date |
Particulars |
J.F. |
(`) |
Date |
Particulars |
J.F. |
(`) |
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2020 |
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2020 |
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April 01 |
Balance b/d
(44,000 + 16,000) |
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60,000 |
April
01 |
Machinery Disposal |
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16,000 |
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2021 |
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Mar.31 |
Balance c/d |
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44,000 |
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60,000 |
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60,000 |
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Provision
for Depreciation Account |
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Dr. |
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Cr. |
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Date |
Particulars |
J.F. |
(`) |
Date |
Particulars |
J.F. |
(`) |
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2020 |
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2020 |
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April 01 |
Machinery
Disposal (4 years) |
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6,400 |
April
01 |
Balance b/d |
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36,000 |
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2021 |
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2021 |
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Mar.31 |
Balance c/d |
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34,000 |
Mar.31 |
Depreciation (on Machine costing
Rs 44,000) |
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4,400 |
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40,400 |
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40,000 |
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Machinery
Disposal Account |
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Dr. |
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Cr. |
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Date |
Particulars |
J.F. |
(`) |
Date |
Particulars |
J.F. |
(`) |
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2020 |
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2020 |
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April 01 |
Machinery |
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16,000 |
April
01 |
Provision for Depreciation |
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6,400 |
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2021 |
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Mar.31 |
Bank (Sale) |
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8,400 |
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Profit and Loss (Loss) |
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1,200 |
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16,000 |
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16,000 |
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Working
Note
1. Calculation of profit or loss on
Machine Sold:
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Particulars |
(`) |
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Original Cost of Machine Sold on
April 01, 2020 |
16,000 |
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Less: Accumulated Depreciation on Machine
Sold (1,600 × 4) |
(6,400) |
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Book Value of April 01, 2020 |
9,600 |
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Less: Sale Value |
(8,400) |
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Loss on Sale |
1,200 |
Question
26:
Ashoka & Co. whose books are closed on 31st March, purchased a machinery
for ` 1,50,000 on 1st April,
2019, Additional machinery was acquired for ` 50,000 on 1st October,
2019. Certain machinery which was purchased for ` 50,000 on 1st
October, 2019 was sold for
` 40,000 on 30th September, 2021.
Prepare the Machinery Account and Accumulated Depreciation Account for all the
years up to the year ended 31st March, 2022. Depreciation is charged @ 10% p.a.
on Straight Line Method. Also, show the Machinery Disposal Account.
Answer:
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Books
of Ashoka
& Co. Machinery
Account |
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Dr. |
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Cr. |
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Date |
Particulars |
J.F. |
(`) |
Date |
Particulars |
J.F. |
(`) |
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2019 |
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2020 |
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Apr.01 |
Bank (I) |
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1,50,000 |
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Oct 01 |
Bank (II) |
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50,000 |
Mar.31 |
Balance c/d |
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2,00,000 |
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2,00,000 |
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2,00,000 |
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2020 |
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2021 |
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Apr.01 |
Balance b/d |
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2,00,000 |
Mar.31 |
Balance c/d |
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2,00,000 |
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2,00,000 |
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2,00,000 |
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2021 |
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2021 |
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Apr.01 |
Balance b/d |
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2,00,000 |
Sep
30 |
Machinery
Disposal A/c |
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50,000 |
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2022 Mar.31,
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Balance c/d |
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1,50,000 |
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2,00,000 |
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2,00,000 |
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Accumulated
Depreciation Account |
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Dr. |
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Cr. |
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Date |
Particulars |
J.F. |
(`) |
Date |
Particulars |
J.F. |
(`) |
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2020 |
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2019 |
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Mar.31 |
Balance c/d |
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Mar.
31 |
Depreciation |
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I |
15,000 |
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I |
15,000 |
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II |
2,500 |
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17,500 |
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II (for 6 months) |
2,500 |
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17,500 |
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17,500 |
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17,500 |
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2021 |
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2020 |
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Mar.31 |
Balance c/d |
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Apr.
01 |
Balance b/d |
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I |
30,000 |
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I |
15,000 |
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II |
7,500 |
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37,500 |
2021 |
II |
2,500 |
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17,500 |
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Mar.
31 |
Depreciation |
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I |
15,000 |
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II |
5,000 |
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20,000 |
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37,500 |
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37,500 |
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2021 |
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2021 |
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Sep 30 |
Machinery disposal (II) |
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10,000 |
Apr. 01 |
Balance b/d |
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Mar.31,
2022 |
Balance c/d (I) |
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45,000 |
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I |
30,000 |
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II |
7,500 |
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37,500 |
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2021 Sep 30 |
Depreciation
(II) |
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2,500 |
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Mar.
31 |
Depreciation (I) |
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15,000 |
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55,000 |
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55,000 |
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Machinery
Disposal Account |
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Dr. |
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Cr. |
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Date |
Particulars |
J.F. |
(`) |
Date |
Particulars |
J.F. |
(`) |
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2021 |
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2021 |
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Sep
30 |
Machinery A/c |
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50,000 |
Sep 30 |
Accumulated Depreciation A/c |
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10,000 |
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Sep 30 |
Bank A/c |
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40,000 |
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50,000 |
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50,000 |
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Working
note
1. Calculation of Profit or Loss on sale of Machine II
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Particulars |
(`) |
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Original Cost Oct 01, 2021 |
50,000 |
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Less: Accumulated Depreciation |
(10,000) |
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Book Value on Sept 30, 2021 |
40,000 |
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Less: Sale Value |
(40,000) |
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Profit / Loss |
NIL |
Question 27
On 1st April, 2014, Veeru Ltd. purchased a machinery for `2,50,000 and spent `50,0000 on its installation. On 1st July, 2016, 1/3rd of machinery purchased on 1st April, 2014 was sold for `15,000 and a new machinery at the cost of `2,00,000 was purchased on the same date. The company has adopted the method of providing depreciation 15% p.a. on Straight Line Method. Show the Machinery Account, Provision for Depreciation Account and Machinery Disposal Account for three years ended on 31st March, 2015 to 31st March, 2017. (Delhi)
Answer
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Machinery
Account |
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Dr. |
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Cr. |
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Date |
Particulars |
J.F. |
(`) |
Date |
Particulars |
J.F. |
(`) |
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2014 |
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2015 |
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April 01 |
Bank A/c (M1) |
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2,50,000 |
Mar.31 |
Balance C/d (M1) |
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3,00,000 |
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April 01 |
Bank A/c (M1) |
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50,000 |
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3.00.000 |
3.00.000 |
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2015 |
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2016 |
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April 01 |
Balance B/d (M1) |
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3,00,000 |
Mar.31 |
Balance C/d (M1) |
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3,00,000 |
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3.00.000 |
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3.00.000 |
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2016 |
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2016 |
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April 31 |
Balance B/d (M1) |
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3.00.000 |
July 01 |
Machinery Disposal A/c (M1) |
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1,00,000 |
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2017 July 01 |
Bank A/c (M2) |
2,00,000 |
2017 |
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Mar.31 |
Balance c/d |
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M1 – 2,00,000 |
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M2 –
2,00,000 |
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4,00,000 |
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5,00,000 |
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5,00,000 |
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P
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Provision
for Depreciation on Machinery Account |
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Dr. |
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Cr. |
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Date |
Particulars |
J.F. |
(`) |
Date |
Particulars |
J.F. |
(`) |
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2015 |
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2015 |
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Mar.31 |
Balance c/d (M1) |
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45,000 |
Mar.31 |
Depreciation A/c (M1) |
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45,000 |
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45,000 |
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45,000 |
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2015 |
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April.01 |
Balance c/d (M1) |
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45,000 |
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2016 |
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2016 |
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Mar.31 |
Balance c/d (M1) |
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90,000 |
Mar.31 |
Depreciation A/c (M1) |
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45,000 |
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90,000 |
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90,000 |
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2016 |
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2016 |
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July 01 |
Machinery Disposal A/c (M1) |
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33,750 |
April.01 |
Balance c/d (M1) |
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90,000 |
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Mar.31 |
Balance c/d |
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2016 |
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M1- 90,000 M1-
22,500 |
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1,12,500 |
July.01 |
Depreciation A/c (On 1/3 Part of M1) |
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3,750 |
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Mar.31 |
Depreciation A/c (On 2/3 of M1) 30,000 |
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M2- 22,500 |
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52,500 |
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1,46,250 |
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1,46,250 |
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M
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Machinery
Disposal Account |
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Dr. |
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Cr. |
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Date |
Particulars |
J.F. |
(`) |
Date |
Particulars |
J.F. |
(`) |
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2016 |
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2016 |
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July 01 |
Machinery A/c (M1) |
|
1,00,000 |
July 01 |
Provision for Depreciation on Machinery A/c (M1) |
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33,750 |
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July 01 |
Bank A/c (Sale) |
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15,000 |
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July 01 |
Profit and loss A/c (Loss) |
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51,250 |
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1,00,000 |
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1,00,000 |
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Ts Grewal Solution 2022-2023
Class 11th
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