Question

A Plant was purchased on 1st July, 2015 at a cost of Rs 3,00,000 and Rs 50,000 were spent on its installation. The depreciation is written off at 15% p.a. on the straight line method. The plant was sold for Rs 1,50,000 on October 01, 2017 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 31 every year.

Show the machinery account and provision for depreciation account for 3 years

Answer 1

Plant Account
Dr.							Cr.
Date	Particulars	J.F.	Amount Rs	Date	Particulars	J.F.	Amount Rs
2015				2015
July.01	Bank		3,50,000	Dec.31	Balance c/d		3,50,000
			3,50,000				3,50,000
2016				2016
Jan.01	Balance b/d		3,50,000
				Dec.31	Balance c/d		3,50,000
			3,50,000				3,50,000
2017				2017
Jan.01	Balance b/d		3,50,000	Oct.01	Provision for Depreciation		1,18,125
Oct.01	Bank		4,00,000	Oct.01	Bank		1,50,000
				Oct.01	Profit and Loss		81,875
				Dec.31	Balance c/d		4,00,000
			7,50,000				7,50,000

Provision for Depreciation Account
Dr.							Cr.
Date	Particulars	J.F.	Amount Rs	Date	Particulars	J.F.	Amount Rs
2015				2015
Dec.31	Balance c/d		26,250	Dec.31	Depreciation		26,250
			26,250				26,250
2016				2016
Dec.31	Balance b/d		78,750	Jan.01	Balance c/d		26,250
				Dec.31	Depreciation		52,500
			78,750				78,750
2017				2017
Oct.01	Plant		1,18,125	Jan.01	Balance b/d		78,750
Dec.31	Balance c/d		15,000	Oct.01	Depreciation (i) (9 months)		39,375
				Dec.31	Depreciation (ii) (3 months)		15,000
			1,33,125				1,33,125