Question

On October 01, 2010, a Truck was purchased for Rs 8,00,000 by Laxmi Transport Ltd. Depreciation was provided at 15% p.a. on the diminishing balance basis on this truck. On December 31, 2013 this Truck was sold for Rs 5,00,000. Accounts are closed on 31st March every year. Prepare a Truck Account for the four years

Answer 1

Books of Laxmi Transport Ltd. Truck Account
Dr.							Cr.
Date	Particulars	J.F.	Amount Rs	Date	Particulars	J.F.	Amount Rs
2010				2011
Oct.01	Bank		8,00,000	Mar.31	Depreciation		60,000
				Mar.31	Balance c/d		7,40,000
			8,00,000				8,00,000
2011				2012
Apr.01	Balance b/d		7,40,000	Mar.31	Depreciation		1,11,000
				Mar.31	Balance c/d		6,29,000
			7,40,000				7,40,000
2012				2013
Apr.01	Balance b/d		6,29,000	Mar.31	Depreciation		94,350
				Mar.31	Balance c/d		5,34,650
			6,29,000				6,29,000
2013				2013
Apr.01	Balance b/d		5,34,650	Dec.31	Depreciation (9 months)		60,148
Dec.31	Profit and Loss (Profit)		25,498	Dec.31	Bank		5,00,000
			5,60,148				5,60,148

Note: As per the solution, the profit on the sale of truck, as on December 31, 2013 is Rs 25,498; however, the answer given in the book is Rs 58,237.