ashoka Ltd. bought a machine on 1st April 2010 for Rs.2,40,000 and spent Rs.4000 on its carriage and Rs.6000 towards installation cost. on 1stJuly 2011 it purchased a second hand machinery for Rs.75000 and spent Rs.25000 on its overhauling. on 1st January2013 it decides to sell the machinery bought on 1stapril2010 at a loss of Rs.20000. it bought another machine on the same date for Rs.40000. company decided to charge depreciation 15% p.a. on written down value method.
Nidhi, the similar question has already been answered by one of our expert Mr. Sagar Gupta. To view, follow the link given below.
https://www.meritnation.com/ask-answer/question/a-company-purchased-a-machinery-for-rs-50-000-on-1-october-2/depreciation-provisions-and-reserves/5648863
We advise you go through it. It will help you a lot. however, if you find any difficulty, then do get back to us. We will help you in the best possible way.
https://www.meritnation.com/ask-answer/question/a-company-purchased-a-machinery-for-rs-50-000-on-1-october-2/depreciation-provisions-and-reserves/5648863
We advise you go through it. It will help you a lot. however, if you find any difficulty, then do get back to us. We will help you in the best possible way.