A company purchased a machinery for rs. 50000 on 1st july 1988.Another machinery costing rs. 10000 was purchased on 1st september 1989.On 31st december,1990,the machinery purchased in 1988 was sold at a loss of rs.5000.The company charges depriciation at the rate of 15% p.a. on diminishing balance method.accounts are closed on 31st december every year.
Prepare the machinery account for 3 years
Machinery Account | |||||||
Dr. | Cr. | ||||||
Date | Particulars | Amount (Rs) | Date | Particulars | Amount (Rs) | ||
1988 |
|
| 1988 |
|
| ||
July 1 | Bank A/c M1 | 50,000 | Dec 31 | Depreciation A/C M1 (50,000*15%*6/12) | 3,750 | ||
|
|
| Dec 31 | Balance c/d (50,000 – 3,750) | 46,250 | ||
|
| 50,000 |
|
| 50,000 | ||
1989 |
|
| 1989 |
|
| ||
Jan 1 | Balance b/d M1 | 46,250 | Dec 31 | Deprecation A/c |
| ||
Sep 1 | Bank A/c M2 | 10,000 |
| M1 (46,250*15%) | 6,938 |
| |
|
|
|
| M2 (10,000*15%*4/12) | 500 | 7,438 | |
|
|
| Dec 31 | Balance c/d |
| ||
|
|
|
| M1 (46,250 – 6,938) | 39,312 |
| |
|
|
|
| M2 (10,000 – 500) | 9,500 | 48,812 | |
|
| 56,250 |
|
| 56,250 | ||
1990 |
|
| 1990 |
|
| ||
Jan 1 | Balance b/d |
| Dec 31 | Depreciation A/c M1 (39,312*15%) | 5,897 | ||
| M1 | 39,312 |
|
| Bank A/c (39,312 – 5,897 – 5,000) (b.f) | 28,415 | |
| M2 | 9,500 | 48,812 |
| Profit & loss A/c (loss on sale) | 5,000 | |
|
|
| Dec 31 | Depreciation A/c M2 (9,500*15%) | 1,425 | ||
|
|
| Dec 31 | Balance c/d M2 (9,500 – 1,425) | 8,075 | ||
|
| 48,812 |
|
| 48,812 | ||
|
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