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Byju's Answer

Standard XI

Accountancy

Asset Disposal

An enterprise...

Question

An enterprise sells on 1 January 2005 a van which it bought on 1 January 2002 for Rs. 3,000, and has been depreciating the van each year at 10% per annum on a straight line basis. It trades this van for Rs. 5,000.
What is the gain or loss on the disposal of the old van?

Gain of Rs. 2,900

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Gain of Rs. 2,100

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Loss of Rs. 1,400

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Loss of Rs. 9,400

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Solution

The correct option is A
Gain of Rs. 2,900

Depreciation per year
= Rs. 3,000 x 10%
= Rs. 300

Book Value
= Rs. 3,000 - $(R s . 300 * 3)$
= Rs. 2,100

Gain
= Rs. 5,000 - Rs. 2,100
= Rs. 2,900

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Q. Question: The following balances appear in the books of Crystal Ltd on January 1, 2005

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An enterprise sells on 1 January 2005 a van which it bought on 1 January 2002 for Rs. 3,000, and has been depreciating the van each year at 10% per annum on a straight line basis. It trades this van for Rs. 5,000. What is the gain or loss on the disposal of the old van?

The correct option is A Gain of Rs. 2,900 Depreciation per year = Rs. 3,000 x 10% = Rs. 300 Book Value = Rs. 3,000 - (Rs.300∗3) = Rs. 2,100 Gain = Rs. 5,000 - Rs. 2,100 = Rs. 2,900

An enterprise sells on 1 January 2005 a van which it bought on 1 January 2002 for Rs. 3,000, and has been depreciating the van each year at 10% per annum on a straight line basis. It trades this van for Rs. 5,000.
What is the gain or loss on the disposal of the old van?

The correct option is A
Gain of Rs. 2,900

Depreciation per year
= Rs. 3,000 x 10%
= Rs. 300

Book Value
= Rs. 3,000 - $(R s . 300 * 3)$
= Rs. 2,100

Gain
= Rs. 5,000 - Rs. 2,100
= Rs. 2,900