Berlia Ltd. Purchased a second hand machine for Rs 56,000
on July 01, 2001 and spent Rs 24,000 on its repair and installation and Rs
5,000 for its carriage. On September 01, 2002, it purchased another machine for
Rs 2,50,000 and spent Rs 10,000 on its installation.
(a) Depreciation is provided on machinery @10% p.a on
original cost method annually on December 31. Prepare machinery account and
depreciation account from the year 2001 to 2004.
(b) Prepare machinery account and depreciation account
from the year 2001 to 2004, if depreciation is provided on machinery @10% p.a.
on written down value method annually on December 31.
Berlia Ltd. Purchased a second hand machine for Rs 56,000 on July 01, 2001 and spent Rs 24,000 on its repair and installation and Rs 5,000 for its carriage. On September 01, 2002, it purchased another machine for Rs 2,50,000 and spent Rs 10,000 on its installation.
(a) Depreciation is provided on machinery @10% p.a on original cost method annually on December 31. Prepare machinery account and depreciation account from the year 2001 to 2004.
(b) Prepare machinery account and depreciation account from the year 2001 to 2004, if depreciation is provided on machinery @10% p.a. on written down value method annually on December 31.
|
Books of Berlia
Ltd. (a) |
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|
Machinery Account (Original Cost Method) |
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|
Dr. |
|
|
|
|
|
|
Cr. |
|
Date |
Particulars |
J.F. |
Amount Rs |
Date |
Particulars |
J.F. |
Amount Rs |
|
2001 |
|
|
|
2001 |
|
|
|
|
Jul.01 |
Bank (i) |
|
85,000 |
Dec.31 |
Depreciation |
|
4,250 |
|
|
(5,600 + 24,000 + 5,000) |
|
|
Dec.31 |
Balance c/d |
|
80,750 |
|
|
|
|
85,000 |
|
|
|
85,000 |
|
|
|
|
|
|
|
|
|
|
2002 |
|
|
|
2002 |
|
|
|
|
Jan.01 |
Balance b/d (i) |
|
80,750 |
Dec.31 |
Depreciation |
|
|
|
Sep.01 |
Bank (ii) |
|
2,60,000 |
|
(i) 8,500, (ii) 8,667 |
|
17,167 |
|
|
(2,50,000 + 10,000) |
|
|
Dec.31 |
Balance c/d |
|
3,23,583 |
|
|
|
|
|
|
(i) 72,250, (ii) 2,51,333 |
|
|
|
|
|
|
3,40,750 |
|
|
|
3,40,750 |
|
|
|
|
|
|
|
|
|
|
2003 |
|
|
|
2003 |
|
|
|
|
Jan.01 |
Balance b/d |
|
3,23,583 |
Dec.31 |
Depreciation |
|
|
|
|
(i) 72,250, (ii) 2,51,333 |
|
|
|
(i) 8,500, (ii) 26,000 |
|
34,500 |
|
|
|
|
|
Dec.31 |
Balance c/d |
|
|
|
|
|
|
|
|
(i) 63,750, (ii) 2,25,333 |
|
2,89,083 |
|
|
|
|
3,23,583 |
|
|
|
3,23,583 |
|
|
|
|
|
|
|
|
|
|
2004 |
Balance b/d |
|
|
2004 |
|
|
|
|
Jan.01 |
(i) 63,750, (ii) 2,25,333 |
|
2,89,083 |
Dec.31 |
Depreciation |
|
|
|
|
|
|
|
|
(i) 8,500, (ii) 26,000 |
|
34,500 |
|
|
|
|
|
Dec.31 |
Balance c/d |
|
|
|
|
|
|
|
|
(i) 55,250, (ii) 1,99,333 |
|
2,54,583 |
|
|
|
|
2,89,083 |
|
|
|
2,89,083 |
|
|
|
|
|
|
|
|
|
|
Depreciation Account |
|||||||
|
Dr. |
|
|
|
|
|
|
Cr. |
|
Date |
Particulars |
J.F. |
Amount Rs |
Date |
Particulars |
J.F. |
Amount Rs |
|
2001 |
|
|
|
2001 |
|
|
|
|
Dec.31 |
Machinery |
|
4,250 |
Dec.31 |
Profit and Loss |
|
4,250 |
|
|
|
|
4,250 |
|
|
|
4,250 |
|
|
|
|
|
|
|
|
|
|
2002 |
|
|
|
2002 |
|
|
|
|
Dec.31 |
Machinery |
|
|
Dec.31 |
Profit and Loss |
|
17,167 |
|
|
(i) 8,500 (ii) 8,667 |
|
17,167 |
|
|
|
|
|
|
|
|
17,167 |
|
|
|
17,167 |
|
|
|
|
|
|
|
|
|
|
2003 |
|
|
|
2003 |
|
|
|
|
Dec.31 |
Machinery |
|
|
Dec.31 |
Profit and Loss |
|
34,500 |
|
|
(i) 8,500 (ii) 26,000 |
|
34,500 |
|
|
|
|
|
|
|
|
34,500 |
|
|
|
34,500 |
|
|
|
|
|
|
|
|
|
|
2004 |
|
|
|
2004 |
|
|
|
|
Dec.31 |
Machinery |
|
34,500 |
Dec.31 |
Profit and Loss |
|
34,500 |
|
|
(i) 8,500 (ii) 26,000 |
|
34,500 |
|
|
|
34,500 |
|
|
|
|
|
|
|
|
|
Working notes: Calculation of annual depreciation
(i) Depreciation (p.a.) on Machinery Purchased on July 01, 2001
|
|
= (56,000 + 24,000 + 5,000) × |
10 |
|
100 |
||
|
|
= Rs 8,500 per annum |
|
(ii) Depreciation (p.a.) on Machinery purchased on September 01, 2002.
|
|
= (2,50,000 + 10,000) × |
10 |
|
100 |
||
|
|
= Rs 26,000 per annum |
|
(b)
|
Machinery Account (Written Down Value method) |
|||||||
|
Dr. |
|
|
|
|
|
|
Cr. |
|
Date |
Particulars |
J.F. |
Amount Rs |
Date |
Particulars |
J.F. |
Amount Rs |
|
2001 |
|
|
|
2001 |
|
|
|
|
Jul.01 |
Bank (i) |
|
85,000 |
Dec.31 |
Depreciation |
|
4,250 |
|
|
(5,600 + 24,000 + 5,000) |
|
|
Dec.31 |
Balance c/d |
|
80,750 |
|
|
|
|
85,000 |
|
|
|
85,000 |
|
|
|
|
|
|
|
|
|
|
2002 |
|
|
|
2002 |
|
|
|
|
Jan.01 |
Balance b/d (i) |
|
80,750 |
Dec.31 |
Depreciation |
|
|
|
Sep.01 |
Bank (ii) |
|
2,60,000 |
|
(i) 8,075, (ii) 8,667 |
|
16,742 |
|
|
(2,50,000 + 10,000) |
|
|
Dec.31 |
Balance c/d |
|
|
|
|
|
|
|
|
(i) 72,675, (ii) 2,51,333 |
|
3,24,008 |
|
|
|
|
3,40,750 |
|
|
|
3,40,750 |
|
|
|
|
|
|
|
|
|
|
2003 |
|
|
|
2003 |
|
|
|
|
Jan.01 |
Balance b/d |
|
3,24,008 |
Dec.31 |
Depreciation |
|
|
|
|
(i) 72,675, (ii) 2,51,333 |
|
|
|
(i) 7,268, (ii) 25,133 |
|
32,401 |
|
|
|
|
|
Dec.31 |
Balance c/d |
|
|
|
|
|
|
|
|
(i) 65,407, (ii) 2,26,200 |
|
2,91,607 |
|
|
|
|
3,24,008 |
|
|
|
3,24,008 |
|
|
|
|
|
|
|
|
|
|
2004 |
Balance b/d |
|
|
2004 |
|
|
|
|
Jan.01 |
(i) 65,407, (ii) 2,26,200 |
|
2,91,607 |
Dec.31 |
Depreciation |
|
|
|
|
|
|
|
|
(i) 6,540, (ii) 22,620 |
|
29,160 |
|
|
|
|
|
Dec.31 |
Balance c/d |
|
|
|
|
|
|
|
|
(i) 58,867, (ii) 2,03,580 |
|
2,62,447 |
|
|
|
|
2,91,607 |
|
|
|
2,91,607 |
|
|
|
|
|
|
|
|
|
|
Depreciation Account |
|||||||
|
Dr. |
|
|
|
|
|
|
Cr. |
|
Date |
Particulars |
J.F. |
Amount Rs |
Date |
Particulars |
J.F. |
Amount Rs |
|
2001 |
|
|
|
2001 |
|
|
|
|
Dec.31 |
Machinery |
|
4,250 |
Dec.31 |
Profit and Loss |
|
4,250 |
|
|
|
|
4,250 |
|
|
|
4,250 |
|
|
|
|
|
|
|
|
|
|
2002 |
|
|
|
2002 |
|
|
|
|
Dec.31 |
Machinery |
|
|
Dec.31 |
Profit and Loss |
|
16,742 |
|
|
(i) 8,075, (ii) 8,667 |
|
16,742 |
|
|
|
|
|
|
|
|
16,742 |
|
|
|
16,742 |
|
|
|
|
|
|
|
|
|
|
2003 |
|
|
|
2003 |
|
|
|
|
Dec.31 |
Machinery |
|
|
Dec.31 |
Profit and Loss |
|
32,401 |
|
|
(i) 7,268, (ii) 25,133 |
|
32,401 |
|
|
|
|
|
|
|
|
32,401 |
|
|
|
32,401 |
|
|
|
|
|
|
|
|
|
|
2004 |
|
|
|
2004 |
|
|
|
|
Dec.31 |
Machinery |
|
|
Dec.31 |
Profit and Loss |
|
29,160 |
|
|
(i) 6,540, (ii) 22,620 |
|
29,160 |
|
|
|
|
|
|
|
|
29,160 |
|
|
|
29,160 |
|
|
|
|
|
|
|
|
|