Question

The value of the machinery in the balance sheet is Rs. 50,000 and after revaluation it came to Rs. 35,000. So what is the journal entry we pass -

• A. Revaluation A/c Dr. 35,000
  To Machinery A/c 35,000
• B. Revaluation A/c Dr. 15,000
  To Machinery A/c 15,000
• C. Machinery A/c Dr. 15,000
  To Revaluation A/c 15,000
• D. Machinery A/c Dr. 35,000
  To Revaluation A/c 35,000

Answer 1

The correct option is B

Revaluation A/c Dr. 15,000
To Machinery A/c 15,000

The value of machinery was reduced by Rs 15,000 on revaluation. Hence, the entry is

Revaluation A/c Dr. 15,000
To Machinery A/c 15,000