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Question 15 Chapter 11 – Unimax Publications of Class 11
15. A company purchased a machinery for ₹ 50,000 on 1st July,2021. Another machinery costing ₹ 10,000 was purchased on 1st sept. 2022. On 31st dec.,2023, the machinery purchased in 2021 was sold at a loss of ₹ 5,000. The company charges depreciation at the rate of 15% on diminishing balance method. Accounts are closed on 31st dec. every year. Prepare machinery account for 3 years.
The solution of Question 15 Chapter 11 – Unimax Publications of Class 11
| Dr. | Machine A/c | Cr. | |||||
| Date | Particulars | J.F. | Amount | Date | Particulars | J.F. | Amount |
| 01/07/21 | To Balance b/d | 50,000 | 31/12/21 | By Deprecation A/c | 3,750 | ||
| 31/12/21 | By Balance C/d | 46,250 | |||||
| 50,000 | 50,000 | ||||||
| 01/01/22 | To Balance b/d | 46,250 | 31/12/22 | By Deprecation A/c | 7,438 | ||
| 01/08/22 | To Bank A/c | 10,000 | 31/12/22 | By Balance C/d | 48,812 | ||
| 56,250 | 56,250 | ||||||
| 01/01/23 | To Balance b/d | 48,812 | 31/10/23 | By Bank A/c | 28,415 | ||
| 31/10/23 | By Profit & Loss A/c | 5,000 | |||||
| 31/12/23 | By Deprecation A/c | 7,322 | |||||
| 31/12/23 | By Balance C/d | 8,075 | |||||
| 48,812 | 48,812 | ||||||
Working Notes:
(1) Depreciation on machinery purchased on July,1,2021.
Dep. On Dec. 31,2021 = ₹ 3,750
Dep. On Dec. 31,2022 = ₹ 6,938
Dep. On Dec. 31,2023 = ₹ 5,897
(2) Book value of machinery sold on 31/12/2021 = ₹ 33,415(28,415+5,000)
(3) Dep. On machinery purchased on sept. 1,2022:
Dep. On 31/12/2022 = ₹ 500
Dep. On 31/12/2023 = ₹ 1,425
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