Question

Kapil Ltd purchased a machinery on July 1, 2001, for Rs 3,50,000. It purchased two additional machines, on April 1, 2002 costing Rs 1,50,000 and on October 1, 2002, costing Rs 1,00,000. Depreciation is provided @ $10\%$ per annum on straight lines basis. On January 1, 2003, the first machinery becomes useless due to technical changes. This machinery was sold for Rs 1,00,000. Prepare Machinery account for 4 years on the basis of the calendar year.

Answer 1

Dr Machinery Account Cr
$\begin{array}{cccccccc}\text{Date}& \text{Particulars}& \text{JF}& \text{Amt. (Rs)}& \text{Date}& \text{Particulars}& \text{JF}& \text{Amt. (Rs)}\\ 2001& & & & 2001& & & \\ \text{Jul 1}& \text{Bank A/c (M1)}& & 3,50,000& \text{Dec 31}& \text{Depreciation}& & \\ & & & & & \text{A/c}(@15\%\text{for}& & \\ & & & & & \text{6 months)}& & 17,500\\ & & & & \text{Dec 31}& \text{Balance c/d}& & 3,32,500\\ & & & \underset{–}{\overline{3,50,000}}& & & & \underset{–}{\overline{3,50,000}}\\ 2002& & & & 2002& & & \\ \text{Jan 1}& \text{Balance b/d}& & & \text{Dec 31}& \text{Depreciation}& & \\ & \text{(M1)}& & 3,32,500& & \text{A/c}& & \\ \text{Apr 1}& \text{Bank A/c (M2)}& & 1,50,000& & \text{M1}=35,000& & \\ \text{Oct 1}& \text{Bank A/c (M3)}& & 1,00,000& & \text{M2}=11,250& & \\ & & & & & \text{M3 =}\underset{–}{2,500}& & 48,750\\ & & & & & & & \\ & & & & \text{Dec 31}& \text{Balance c/d}& & \\ & & & & & \text{M1}=2,97,500& & \\ & & & & & \text{M2}=1,38,750& & \\ & & & & & \text{M3}=\underset{–}{97,500}& & 5,33,750\\ & & & \underset{–}{\overline{5,82,500}}& & & & \underset{–}{\overline{5,82,500}}\\ 2003& & & & 2003& & & \\ \text{Jan 1}& \text{Balance b/d}& & & \text{Jan 1}& \text{Bank A/c (M1)}& & 1,00,000\\ & \text{M1}=2,97,500& & & \text{Jan 1}& \text{Profit}\&& & \\ & \text{M2}=1,38,750& & & & \text{Loss A/c (Loss)}& & 1,97,500\\ & \text{M3}=\underset{–}{97,500}& & 5,33,750& \text{Dec 31}& \text{Depreciation}& & \\ & & & & & \text{A/c}& & \\ & & & & & \text{M2}=15,000& & \\ & & & & & \text{M3}=\underset{–}{10,000}& & 25,000\\ & & & & \text{Dec 31}& \text{Balance c/d}& & \\ & & & & & \text{M1}=1,23,750& & \\ & & & & & \text{M3}=\underset{–}{87,500}& & 2,11,250\\ & & & \underset{–}{\overline{5,33,750}}& & & & \underset{–}{\overline{5,33,750}}\\ 2004& & & & 2004& & & \\ \text{Jan 1}& \text{Balance b/d}& & & \text{Dec 31}& \text{Depreciation}& & \\ & \text{M2}=1,23,750& & & & \text{A/c}& & \\ & \text{M3}=\underset{–}{87,500}& & 2,11,250& & \text{M2}=15,000& & \\ & & & & & \text{M3}=\underset{–}{10,000}& & 25,000\\ & & & & \text{Dec 31}& \text{Balance c/d}& & \\ & & & & & \text{M2}=1,08,750& & \\ & & & & & \text{M3}=\underset{–}{77,500}& & 1,86,250\\ & & & \underset{–}{\overline{2,11,250}}& & & & \underset{–}{\overline{2,11,250}}\\ 2005& & & & & & & \\ \text{Jan 1}& \text{Balance b/d}& & & & & & \\ & \text{M2}=1,08,750& & & & & & \\ & \text{M3}=\underset{–}{77,500}& & 1,86,250& & & & \end{array}$