Dear neha mam,
In previous query you told that while getting profit on sale of machinery we pass the entry
Machinery a/c .....dr
To profit on sale of machinery
But here why we are debiting machinery a/c as machinery is sold off? Plz explain with reason

Dear Student,

Let's understand this with an example. Suppose, a machine costing 10,000 has been sold for Rs 12,000.

Now, ideally the Machinery A/c should be decreased by 10,000 (i.e the cost of the asset) and this decrease implies that credit side of the account shall be affected.

But what do we do! We record the sale proceeds on the credit side (i.e. 12,000). However, this is not the actual amount by which the asset value has declined. So, to counter this, we record the profit figure of 2,000 on the opposite side i.e. the debit side of the Asset a/c.

Alternatively, you can also just record the actual value of the asset (i.e. 10,000) on the credit side and in that case profit figure will not be recorded in the Asset A/c.

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