Hi-Fi Ltd. acquired machinery on 1st January 2012 at a cost of Rs 36,000 and spent Rs 4,000 for its installation. The firm writes off depreciation at 10 % P.A. on WDV basis. The books are closed on 31st December.
Closing balance of machinery account for 1st & 2nd year will be Rs.& Rs _.

32, 400, 29, 160

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36, 000, 36, 000

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32, 400, 36, 000

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36, 000, 32, 400

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Solution

The correct option is D $36, 000, 32, 400$
Total cost of machinery = 36,000 + 4,000
= RS-40,000.
WDV at the end of year 1 :- Total cost - depreciation
= 40,000 - 10/100 x 40,000
= RS-36,000.
WDV at the end of year 2 :- WDV at the end of year 1 - depreciation
= 36,000 - 10/100 x 36,000
= RS-32,400.

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Hi-Fi Ltd. acquired machinery on 1st January 2012 at a cost of Rs 36,000 and spent Rs 4,000 for its installation. The firm writes off depreciation at 10 % P.A. on WDV basis. The books are closed on 31st December. Closing balance of machinery account for 1st & 2nd year will be Rs.____& Rs _____.

The correct option is D 36,000,32,400Total cost of machinery = 36,000 + 4,000 = RS-40,000.WDV at the end of year 1 :- Total cost - depreciation = 40,000 - 10/100 x 40,000 = RS-36,000. WDV at the end of year 2 :- WDV at the end of year 1 - depreciation = 36,000 - 10/100 x 36,000 = RS-32,400.

Hi-Fi Ltd. acquired machinery on 1st January 2012 at a cost of Rs 36,000 and spent Rs 4,000 for its installation. The firm writes off depreciation at 10 % P.A. on WDV basis. The books are closed on 31st December.
Closing balance of machinery account for 1st & 2nd year will be Rs.& Rs _.

The correct option is D $36, 000, 32, 400$
Total cost of machinery = 36,000 + 4,000
= RS-40,000.
WDV at the end of year 1 :- Total cost - depreciation
= 40,000 - 10/100 x 40,000
= RS-36,000.
WDV at the end of year 2 :- WDV at the end of year 1 - depreciation
= 36,000 - 10/100 x 36,000
= RS-32,400.