Question

Following information was extracted from the books of a Not-for-Profit Organisation:
Furniture as on 31-3-2011 Rs 2,20,000. Furniture (having a book value as on 1-4-2011 of Rs 20,000) sold at a loss of $20\%$ on 31-12-2011. Furniture is to be depreciated @ $10\%$ p.a Furniture costing Rs 1,50,000 was also purchased on 1-10-2011. Find out the value of furniture as on 31-3-2012.

Answer 1

$\begin{array}{ccccc}\text{Dr}& & \text{FURNITURE ACCOUNT}& & \text{Cr}\end{array}\begin{array}{cccc}\text{Particulars}& \text{Amount}& \text{Particulars}& \text{Amount}\\ \text{To Balance b/d}& 2,20,000& \text{By Depreciation A/c}& 1,500\\ \text{To Bank A/c (Purchases)}& 1,50,000& (Rs20,000\times \frac{10}{100}\times \frac{9}{12})& \\ & & \text{By Bank A/c (Sale Proceeds)}& 14,800\\ & & \left[\right(Rs20,000-\text{Rs}1,500)-20\%\text{of Rs}18,500]& \\ & & \text{By Income and Expenditure A/c}& 3,700\\ & & [20\%\text{of Rs}18,500]& \\ & & \text{By Depreciation A/c}& 27,500\\ & & (Rs2,00,000\text{for1 year},20,000\text{on})& \\ & & Rs1,50,000\text{for}1/2\text{year Rs}7,500)& \\ & \underset{–}{}& \text{By Balance c/d}& \underset{–}{3,22,500}\\ & 3,70,000& & 3,70,000\end{array}$