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Question 5 Chapter 11 – Unimax Publications of Class 11
A Maruti van was purchased on 1.1.2021 for ₹ 60,000 and ₹ 5,000 was spent on its repairs and registration. On 1.7.2022 another van was purchases for ₹ 70,000. On 1.1.2023 first van purchased on 1.1.2021 was sold for ₹ 45,000 and a new van costing ₹ 1,70,000 was purchased on the same date. Show Maruti van account from 2021-2023 on the basis of straight line method, if the rate of depreciation charged is 10% p.a. assume that books are closed on 31st December every year.
The solution of Question 5 Chapter 11 – Unimax Publications of Class 11
| Dr. | Machine A/c | Cr. | |||||
| Date | Particulars | J.F. | Amount | Date | Particulars | J.F. | Amount |
| 01/01/18 | To Bank A/c | 60,000 | 31/12/18 | By Deprecation A/c | 6,500 | ||
| 01/01/18 | To Bank A/c | 5,000 | 31/12/18 | By Balance C/d | 58,500 | ||
| 65,000 | 65,000 | ||||||
| 01/01/19 | To Balance A/c | 58,500 | 31/12/19 | By Deprecation A/c | 10,000 | ||
| 01/07/19 | To Bank A/c | 70,000 | 31/12/19 | By Balance C/d | 1,18,500 | ||
| 1,28,500 | 1,28,500 | ||||||
| 01/01/20 | To Balance b/d | 1,18,500 | 31/12/20 | By Bank A/c | 45,000 | ||
| 01/07/20 | To Bank A/c | 1,70,000 | 31/12/20 | By Profit & Loss A/c | 7,000 | ||
| 31/12/20 | By Deprecation A/c | 24,000 | |||||
| 31/12/20 | By Balance C/d | 2,12,500 | |||||
| 2,88,500 | 2,88,500 | ||||||
Working Note:
(1) Annul depreciation on van purchases on Jan.1, 2018 = ₹ 6,500.
(2) Annual depreciation on second van purchases = ₹ 7,000.
(3) Annual depreciation of third van purchases = ₹ 17,000.
(4) Book value of first van purchases, on Jan. 1,2020 =₹ 52,000.
(5) Loss on sales of first van = ₹ (52,000-45,000) = ₹ 7,000
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