On January 01, 2010 Raj and Son’s purchased a second hand machinery costing Rs.3,00,000 and spent 20,000 on its overhauling. It also spent 10,000 on transportation and installation of the machinery. It was decided to provide for depreciation @ of 10% on Written Down Value Method. The machinery was destroyed by the fire on July 31, 2013 and an insurance claim of 80,000 was admitted by the insurance company.

Prepare Machinery Account, Accumulated Depreciation Account and Machinery Disposal Account assuming that the company closes its books on December 31 every year.

Asked by Topperlearning User | 4th Aug, 2016, 01:26: PM

Expert Answer:

Books of Raj and Son’s

Machinery Account

Dr.

 

 

 

 

 

 

Cr.

Date

Particulars

J.F.

Amount

Rs. 

Date

Particulars

J.F.

Amount

Rs. 

2010

 

 

 

2010

 

 

 

Jan 1

To Bank A/c

 

3,30,000

Dec 31

By Balance c/d

 

3,30,000

 

 

 

3,30,000

 

 

 

3,30,000

2011

 

 

 

2011

 

 

 

Jan 1

To Balance b/d

 

3,30,000

Dec 31

By Balance c/d

 

3,30,000

 

 

 

3,30,000

 

 

 

3,30,000

2012

 

 

 

2012

 

 

 

Jan 1

To Balance b/d

 

3,30,000

Dec 31

By Balance c/d

 

3,30,000

 

 

 

3,30,000

 

 

 

3,30,000

2013

 

 

 

2013

 

 

 

Jan 1

To Balance b/d

 

3,30,000

Dec 31

Answered by  | 4th Aug, 2016, 03:26: PM