Shakti Cements purchased on 1st April, 2015 a plant for ₹ 80,000. On 1st July, 2016, it purchased additional plant costing ₹ 48,000. On 1st December, 2017, the plant purchased on 1st April, 2015 was sold for ₹ 42,000 plus IGST @ 12% and on the same date a fresh plant was purchased for ₹ 75,000 plus CGST and SGST @ 6% each. Depreciation is provided at 10% p.a. on the Diminishing Balance Method. Accounts are closed on 31st March each year. Show the plant Account for 3 years (along with working notes).
Book of Shakti Cements
Plant Account
Dr.
Cr.
Date
Particulars
J.F.
Amount
(Rs)
Date
Particulars
J.F.
Amount
(Rs)
2015
2016
Apr.01
Bank (I)
80,000
Mar.31
Depreciation (I)
8,000
Mar.31
Balance c/d (I)
72,000
80,000
80,000
2016
2017
Apr.01
Balance b/d (I)
72,000
Mar.31
Depreciation
Jul. 01
Bank (II)
48,000
I
7,200
II (for 9 Months)
3,600
10,800
Mar.31
Balance c/d
I
64,800
II
44,400
1,09,200
1,20,000
1,20,000
2017
2017
Apr.01
Balance b/d
Dec.01
Depreciation (I) (for 8 Months)
4,320
I
64,800
Dec.01
Bank (I)
42,000
II
44,400
1,09,200
Dec.01
Profit and Loss (Loss)
18,480
2018
Dec.01
Bank (III)
75,000
Mar.31
Depreciation
II
4,440
III (for 4 Months)
2,500
6,940
Mar.31
Balance c/d
II
39,960
III
72,500
1,12,460
1,84,200
1,84,200
Working Note
(1) Calculation of Profit or Loss on Sale of Plant I:
Particulars
Amount
(Rs)
Book Value of Plant I as on Apr 01, 2017
64,800
Less: Depreciation on Plant I (for 8 Months )
(4,320)
Book Value of Plant I on Dec. 01 2017
60,480
Less: Sale Value
(42,000)
Loss on Sale
18,480
(2) Journal entries for sale and purchase with GST
Journal
Date
Particulars
L.F.
Debit
Amount
(₹)
Credit
Amount
(₹)
2017
Dec 1
Bank A/c
Dr.
47,040
To Machinery A/c
42,000
To Output IGST A/c
(Machinery purchased on 1st April, 2015 sold with IGST @ 12% )
5,040
Dec 1
Machinery A/c
Input CGST A/c
Input SGST A/c
To Bank A/c
(Machinery purchased with CGST and SGST @ 6% each paid.)
Dr.
Dr.
Dr.
75,000
4,500
4,500
84,000
|
Book of Shakti Cements Plant Account |
|||||||||||
|
Dr. |
|
Cr. |
|||||||||
|
Date |
Particulars |
J.F. |
Amount (Rs) |
Date |
Particulars |
J.F. |
Amount (Rs) |
||||
|
2015 |
|
2016 |
|
||||||||
|
Apr.01 |
Bank (I) |
|
80,000 |
Mar.31 |
Depreciation (I) |
|
8,000 |
||||
|
|
|
|
|
Mar.31 |
Balance c/d (I) |
|
72,000 |
||||
|
|
|
|
80,000 |
|
|
|
80,000 |
||||
|
2016 |
|
|
|
2017 |
|
|
|
||||
|
Apr.01 |
Balance b/d (I) |
|
72,000 |
Mar.31 |
Depreciation |
|
|
||||
|
Jul. 01 |
Bank (II) |
|
48,000 |
|
I |
7,200 |
|
|
|||
|
|
|
|
|
|
II (for 9 Months) |
3,600 |
|
10,800 |
|||
|
|
|
|
|
Mar.31 |
Balance c/d |
|
|
||||
|
|
|
|
|
|
I |
64,800 |
|
|
|||
|
|
|
|
|
|
II |
44,400 |
|
1,09,200 |
|||
|
|
|
|
1,20,000 |
|
|
|
1,20,000 |
||||
|
2017 |
|
|
|
2017 |
|
|
|
||||
|
Apr.01 |
Balance b/d |
|
|
Dec.01 |
Depreciation (I) (for 8 Months) |
|
4,320 |
||||
|
|
I |
64,800 |
|
|
Dec.01 |
Bank (I) |
|
42,000 |
|||
|
|
II |
44,400 |
|
1,09,200 |
Dec.01 |
Profit and Loss (Loss) |
|
18,480 |
|||
| 2018 | |||||||||||
|
Dec.01 |
Bank (III) |
|
75,000 |
Mar.31 |
Depreciation |
|
|
||||
|
|
|
|
|
|
II |
4,440 |
|
|
|||
|
|
|
|
|
|
III (for 4 Months) |
2,500 |
|
6,940 |
|||
|
|
|
|
|
Mar.31 |
Balance c/d |
|
|
||||
|
|
|
|
|
|
II |
39,960 |
|
|
|||
|
|
|
|
|
|
III |
72,500 |
|
1,12,460 |
|||
|
|
|
|
1,84,200 |
|
|
|
|
1,84,200 |
|||
|
|
|
|
|
|
|
|
|
||||
Working Note
(1) Calculation of Profit or Loss on Sale of Plant I:
|
Particulars |
Amount (Rs) |
|
Book Value of Plant I as on Apr 01, 2017 |
64,800 |
|
Less: Depreciation on Plant I (for 8 Months ) |
(4,320) |
|
Book Value of Plant I on Dec. 01 2017 |
60,480 |
|
Less: Sale Value |
(42,000) |
|
Loss on Sale |
18,480 |
(2) Journal entries for sale and purchase with GST
|
Journal
|
|||||
|
Date
|
Particulars
|
L.F.
|
Debit
Amount
(₹)
|
Credit
Amount
(₹)
|
|
|
|
|
|
|
||
|
2017
|
|
|
|
||
|
Dec 1
|
Bank A/c |
Dr.
|
47,040
|
|
|
|
|
To Machinery A/c |
|
|
42,000
|
|
|
|
To Output IGST A/c (Machinery purchased on 1st April, 2015 sold with IGST @ 12% ) |
|
|
5,040
|
|
|
Dec 1 |
Machinery A/c Input CGST A/c Input SGST A/c To Bank A/c (Machinery purchased with CGST and SGST @ 6% each paid.) |
Dr. Dr. Dr. |
75,000 4,500 4,500 |
84,000 |
|
|
|
|
|
|
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