Question: A Noida based Construction Company owns 5 cranes and the value of these assets in its books on April 1, 2001 is Rs $40, 00, 000$ . On October 1, 2001 it sold one of its cranes whose value was Rs $5, 00, 000$ on April 1, 2001 at $10 %$ profit. On the same day, it purchased 2 cranes for Rs $4, 50, 000$ each.
Prepare Cranes account. It closes the books on December 31 and provides for depreciation on $10 %$ written down value.

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Solution

Answer :
Dr Cranes Account Cr
Date Particulars JF Amt.(Rs) Date Particulars JF Amt.(Rs)
2004 Apr 1 To Balance b/d $40, 00, 000$ 2004 Oct 1 By Depreciation A/c (@ $10 %$ on $5, 00, 000$ for six moths) $25, 000$
Oct 1 To Profit & Loss A/c (Profit) $47, 500$ Oct 1 By Bank A/c $[4, 75, 000 \times \frac{110}{100}]$ $5, 22, 500$
Oct 1 To Bank A/c $(4, 50, 000 \times 2)$ $9, 00, 000$ Dec 31 By Depreciation A/c (@ $10 %$ on $35,00,000 for 9 months) $2, 62, 500$
(@10 months on $9, 00, 000$ for 3 months) $22, 500$
Dec 31 By Balance c/d $41, 15, 000$
$49, 47, 500$ $49, 47, 500$

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Date	Particulars	JF	Amt.(Rs)	Date	Particulars	JF	Amt.(Rs)
2004 Apr 1	To Balance b/d		$40, 00, 000$	2004 Oct 1	By Depreciation A/c (@ $10 %$ on $5, 00, 000$ for six moths)		$25, 000$
Oct 1	To Profit & Loss A/c (Profit)		$47, 500$	Oct 1	By Bank A/c $[4, 75, 000 \times \frac{110}{100}]$		$5, 22, 500$
Oct 1	To Bank A/c $(4, 50, 000 \times 2)$		$9, 00, 000$	Dec 31	By Depreciation A/c (@ $10 %$ on $35,00,000 for 9 months)		$2, 62, 500$
					(@10 months on $9, 00, 000$ for 3 months)		$22, 500$
				Dec 31	By Balance c/d		$41, 15, 000$
			$49, 47, 500$				$49, 47, 500$