A firm purchased on 1st April, 2009, a second hand Machinery for Rs 36,000 and spent Rs 4,000 on its - Accountancy - Depreciation Provisions and Reserves

Question

A firm purchased on 1st April, 2009, a second hand Machinery for
Rs 36,000 and spent Rs 4,000 on its installation On 1st Oct in the
same year another Machinery costing Rs 20,000 was purchased On 1st
Oct , 2011, the Machinery bought on 1st April, 2009 was sold off
for Rs 12,000 and on the same date a fresh Machine was purchased
for Rs 64,000 Depriciation is provided annually on 31st March, @
10% p a on the Written Down Value Method Show the Machine account
from 1st April, 2009 to 31st March, 2013

Manisha Arora · Accepted Answer

Machinery Account

Dr
Cr

Date
Particulars
Amount
(Rs)
Date
Particulars
Amount
(Rs)

2009

2010

Apr 01
Bank A/c (M1)
40,000
Mar 31
Depreciation A/c

(Rs 36,000+Rs 4,000)

M1
4,000

M2
1,000
5,000

Oct 01
Bank A/c (M2)
20,000
Mar 31
Balance c/d

M1
36,000

M2
19,000
55,000

60,000

2010

2011

Apr 01
Balance b/d

Mar 31
Depreciation A/c

M1
36,000

M1
3,600

M2
19,000
55,000

M2
1,900
5,500

Mar 31
Balance c/d

M1
32,400

M2
17,100
49,500

55,000

2011

Apr 01
Balance b/d
49,500
Ocr 01
Depreciation A/c (on M1 for 6
months)
1,620

M1
32,400

Bank A/c (Sale of
M1)
12,000

M2
17,100
49,500

Profit and Loss A/c (Loss on
Sale)
18,780

Mar 01
Bank A/c (M3)
64,000
2012
Mar 31
Depreciation on-

M2
1,710

M3
3,200
4,910

Mar 31
Balance c/d

M2
15,390

M3
60,800
76,190

1,13,500

2012

2013

Apr 01
Balance b/d

Mar 31
Depreciation

M2
15,390

M2
1,539

M3
60,800
76,190

M3
6,080
7,619

Mar 31
Balance c/d

M2
13,851

M3
54,720
68,571

76,190

Working
Notes: Calculation of Profit or Loss on
Sale

Particulars
Amount

Value of M1 as on Apr 01,
2011
32,400

Less: Depreciation for 6 months
1,620

Value of M1 as on Oct 01,
2011
30,780

Less: Sale Value
12,000

Loss on Sale
18,780

Particulars	Amount
Value of M1 as on Apr. 01, 2011	32,400
Less: Depreciation for 6 months	1,620
Value of M1 as on Oct. 01, 2011	30,780
Less: Sale Value	12,000
Loss on Sale	18,780

Machinery Account
Dr.					Cr.
Date	Particulars		Amount (Rs)	Date		Particulars		Amount (Rs)
2009				2010
Apr.01	Bank A/c (M1)		40,000	Mar. 31		Depreciation A/c
	(Rs 36,000+Rs 4,000)					M1	4,000
						M2	1,000	5,000
Oct.01	Bank A/c (M2)		20,000	Mar. 31		Balance c/d
						M1	36,000
						M2	19,000	55,000
			60,000					60,000
2010				2011
Apr.01	Balance b/d			Mar. 31		Depreciation A/c
	M1	36,000				M1	3,600
	M2	19,000	55,000			M2	1,900	5,500
				Mar. 31		Balance c/d
						M1	32,400
						M2	17,100	49,500
			55,000					55,000
2011				2011
Apr.01	Balance b/d		49,500	Ocr.01		Depreciation A/c (on M1 for 6 months)		1,620
	M1	32,400				Bank A/c (Sale of M1)		12,000
	M2	17,100	49,500			Profit and Loss A/c (Loss on Sale)		18,780
Mar. 01	Bank A/c (M3)		64,000	2012 Mar.31		Depreciation on-
						M2	1,710
						M3	3,200	4,910
				Mar. 31		Balance c/d
						M2	15,390
						M3	60,800	76,190
			1,13,500					1,13,500
2012				2013
Apr.01	Balance b/d			Mar.31		Depreciation
	M2	15,390				M2	1,539
	M3	60,800	76,190			M3	6,080	7,619
				Mar.31		Balance c/d
						M2	13,851
						M3	54,720	68,571
			76,190					76,190