Rehan Ltd. purchased a machinery on 1st April 2013 for rs 3,80,000 and spent 20,000 rs on its cartage and rs 50,000 on its erection. On the date purchase, it was estimated that the effective life of the machine will be 10yrs and after 10 yrs its scrap value will be 50,000. The accounts are closed every yr on 31st March. Prepare Machinery Account and Depreciation Account for the first 4 yrs on the basis of straight-line method.
Dear Student,
Machinery Account | ||||||
Dr. | Cr. | |||||
Date | Particulars | Amount (Rs) |
Date | Particulars | Amount (Rs) |
|
2013-14 | 2013-14 | |||||
Apr.01 | Bank A/c | 4,50,000 | Mar.31 | Depreciation A/c | 40,000 | |
Mar.31 | Balance c/d | 4,10,000 | ||||
4,50,000 | 4,50,000 | |||||
2014-15 | 2014-15 | |||||
Apr.01 | Balance b/d | 4,10,000 | Mar.31 | Depreciation A/c | 40,000 | |
Mar.31 | Balance c/d | 3,70,000 | ||||
4,10,000 | 4,10,000 | |||||
2015-16 | 2015-16 | |||||
Apr.01 | Balance b/d | 3,70,000 | Mar.31 | Depreciation A/c | 40,000 | |
Mar.31 | Balance c/d | 3,30,000 | ||||
3,70,000 | 3,70,000 | |||||
2016-17 | 2016-17 | |||||
Apr.01 | Balance b/d | 3,30,000 | Mar.31 | Depreciation A/c | 40,000 | |
Mar.31 | Balance c/d | 2,90,000 | ||||
3,30,000 | 3,30,000 | |||||
Depreciation Account | ||||||
Dr. | Cr. | |||||
Date | Particulars | Amount (Rs) |
Date | Particulars | Amount (Rs) |
|
2013-14 | 2013-14 | |||||
Mar.31 | Machinery A/c | 40,000 | Mar.31 | P&L A/c | 40,000 | |
40,000 | 40,000 | |||||
2014-15 | 2014-15 | |||||
Mar.31 | Machinery A/c | 40,000 | Mar.31 | P&L A/c | 40,000 | |
40,000 | 40,000 | |||||
2015-16 | 2015-16 | |||||
Mar.31 | Machinery A/c | 40,000 | Mar.31 | P&L A/c | 40,000 | |
40,000 | 40,000 | |||||
2016-17 | 2016-17 | |||||
Mar.31 | Machinery A/c | 40,000 | Mar.31 | P&L A/c | 40,000 | |
40,000 | 40,000 | |||||