Question

Give journal entry for:
Depreciation transferred to profit and loss account of $Rs.7500$.

• A. Profit and Loss A/c Dr. $7500$
  To Depreciation A/c $7500$
• B. Profit and Loss A/c Dr. $7000$
  To Depreciation A/c $7000$
• C. Depreciation A/c Dr. $7500$
  To Profit and Loss A/c $7500$
• D. None of the above

Answer 1

The correct option is A Profit and Loss A/c Dr. $7500$

To Depreciation A/c $7500$
Depreciation is a charge to profit & loss account. Every year an amount is charged as depreciation on each of the asset by passing the below entry:

Depreciation A/c Dr. $7500$

To Asset A/c $7500$

Depreciation amount has to be transferred to profit & loss account by making the below journal entry:

Profit & Loss A/c Dr. $7500$

To Depreciation A/c $7500$