Question

Question: A plant was purchased on 1st July 2000 at a cost of Rs.$3,00,000$ and Rs. $50,000$ were spent on its installation. The depreciation is written off at $15\%$ per annum on the straight-line method. The plant was sold for Rs.$1,50,000$ on October 1, 2002, and on the same date, a new Plant was installed at the cost of Rs.$4,00,000$ including purchasing value. The accounts are closed on December 31st every year.
Show the Machinery account and Provision for depreciation account for 3 years.

Answer 1

Answer :
Dr Plant Account Cr

Date	Particulars	JF	Amt.(Rs)	Date	Particulars	JF	Amt.(Rs)
2000 July	To Bank A/c (3,00,000 + 50,000)		$3,50,000$	2000 Dec 31	By Balance c/d		$3,50,000$
			$3,50,000$				$3,50,000$
2001 Jan 1	To Balance b/d		$3,50,000$	2001 Dec 31	By Balance c/d		$3,50,000$
			$3,50,000$				$3,50,000$
2002 Jan 1	To Balance b/d		$3,50,000$	2002 Oct 1	By Provision for Dep A/c		$1,18,125$
Oct 1	To Bank A/c		$4,00,000$	Oct 1	By Bank A/c		$1,50,000$
				Oct 1	By Profit & Loss A/c		$81,875$
					By Balance c/d		$4,00,000$
			$7,50,000$				$7,50,000$

Dr Provision for Depreciation Account Cr

Date	Particulars	JF	Amt.(Rs)	Date	Particulars	JF	Amt.(Rs)
2000 Dec 31	To Balance c/d		$26,250$	2000 Dec 31	To Depreciation A/c ($3,50,000@15\%$) for 6 months		$26,250$
			$26,250$				$26,250$
2001 Dec 31	To Balance c/d		$78,750$	2001 Jan 1	By Balance b/d		$26,250$
				Dec 31	By Depreciation A/c		$52,500$
			$78,750$				$78,750$
2002 Oct 1	To Plant A/c (26,250 + 52,500+ 39,375)		$1,18,125$	2002 Jan 1	By Balance b/d		$78,750$
				Oct 1	By Depreciation A/c $(3,50,000@15\%for9months)$		$39,375$
Dec 31	To Balance c/d		$15,000$	Dec 31	By Depreciation A/c $(4,00,000\times 15\%\times 3months)$		$15,000$
			$1,33,125$				$1,33,125$