Modern ltd purchased a machinery on 1st may 2003 for rs 60,000. on 1st july ,2004 it purchased another machine for rs 20,000. on 31st march 2005 ,it sold the first machine purchased in 2003 for rs 38,500. depreciation is providedat 20% p.a.on the original cost each year. accounts are closed on 31st december each year. prepare the machinery a/c
In the Books of Modern Ltd.
Machinery Account | |||||||
Dr. | Cr. | ||||||
Date | Particulars | Amount (Rs) | Date | Particulars | Amount (Rs) | ||
2003 |
|
| 2003 |
|
| ||
May 1 | Bank A/c M1 | 60,000 | Dec 31 | Depreciation A/c [60,000*20%*8/12] | 8,000 | ||
|
|
| Dec 31 | Balance c/d M1 | 52,000 | ||
|
| 60,000 |
|
| 60,000 | ||
2004 |
|
| 2004 |
|
| ||
Jan 1 | Balance b/d M1 | 52,000 | Dec 31 | Depreciation A/c |
| ||
July 1 | Bank A/c M2 | 20,000 |
| M1 | 12,000 |
| |
|
|
|
| M2 [20,000*20%*6/12] | 2,000 | 14,000 | |
|
|
| Dec 31 | Balance c/d |
| ||
|
|
|
| M1 [52,000 – 12,000] | 40,000 |
| |
|
|
|
| M2 [20,000 – 2,000] | 18,000 | 58,000 | |
|
| 72,000 |
|
| 72,000 | ||
2005 |
|
| 2005 |
|
| ||
Jan 1 | Balance b/d |
| Mar 31 | Bank A/c M1 | 38,500 | ||
| M1 | 40,000 |
| Mar 31 | Depreciation A/c M1 [60,000*20%*3/12] | 3,000 | |
| M2 | 18,000 | 58,000 | Dec 31 | Depreciation A/c M2 | 4,000 | |
Mar 31 | Profit & Loss A/c (profit on sale) (b.f.) | 1,500 | Dec 31 | Balance c/d M2 | 14,000 | ||
|
| 59,500 |
|
| 59,500 | ||
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