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On 1 Apr 2008 Krishna transport company purchase motor truck Rajasthan motor l.t.d on hire purchase basis of which was Rs.73470 ; Rs.20000 was paid as immediate deposit and the balance was payable in three equal installments of Rs.20000 each on 31 March each year , interest is to be charged at 6% per annum depreciation was written off @10% p.a. on wtitten down value mathod?
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On 1 Apr 2008 Krishna transport company purchase motor truck Rajasthan...
Calculation of Hire Purchase Price:
The hire purchase price of the motor truck can be calculated by adding the deposit paid to the balance payable in installments. Therefore, the hire purchase price is Rs. 20,000 (deposit) + Rs. 53,470 (balance) = Rs. 73,470.
Calculation of Annual Installment:
The annual installment can be calculated by dividing the balance payable by the number of installments. In this case, the balance payable is Rs. 53,470 and there are three installments. Therefore, the annual installment is Rs. 53,470 / 3 = Rs. 17,823.33.
Calculation of Interest:
The interest is charged at 6% per annum. Since the balance payable is reduced by the annual installment each year, the interest is charged on the reducing balance. Therefore, the interest for the first year can be calculated as follows:
Interest for the first year = (Balance payable - Annual installment) * Interest rate
= (Rs. 53,470 - Rs. 17,823.33) * 6%
= Rs. 2,505.80
Similarly, the interest for the second and third years can be calculated using the same formula. However, as the balance payable becomes zero after the second installment, there will be no interest charged for the third year.
Calculation of Depreciation:
The depreciation is written off at 10% p.a. using the written down value method. The written down value at the beginning of each year is calculated by subtracting the depreciation for the previous year from the value at the beginning of the previous year.
Depreciation for the first year = Hire purchase price * Depreciation rate
= Rs. 73,470 * 10%
= Rs. 7,347
Written down value at the beginning of the second year = Hire purchase price - Depreciation for the first year
= Rs. 73,470 - Rs. 7,347
= Rs. 66,123
Similarly, the written down value at the beginning of the third year can be calculated using the same formula.
Summary:
- The hire purchase price of the motor truck is Rs. 73,470.
- The annual installment is Rs. 17,823.33.
- The interest for the first year is Rs. 2,505.80.
- The interest for the second year is calculated using the same formula and is Rs. 1,051.20.
- There is no interest charged for the third year.
- The depreciation for the first year is Rs. 7,347.
- The written down value at the beginning of the second year is Rs. 66,123.
- The written down value at the beginning of the third year can be calculated using the same formula.
The hire purchase price of the motor truck can be calculated by adding the deposit paid to the balance payable in installments. Therefore, the hire purchase price is Rs. 20,000 (deposit) + Rs. 53,470 (balance) = Rs. 73,470.
Calculation of Annual Installment:
The annual installment can be calculated by dividing the balance payable by the number of installments. In this case, the balance payable is Rs. 53,470 and there are three installments. Therefore, the annual installment is Rs. 53,470 / 3 = Rs. 17,823.33.
Calculation of Interest:
The interest is charged at 6% per annum. Since the balance payable is reduced by the annual installment each year, the interest is charged on the reducing balance. Therefore, the interest for the first year can be calculated as follows:
Interest for the first year = (Balance payable - Annual installment) * Interest rate
= (Rs. 53,470 - Rs. 17,823.33) * 6%
= Rs. 2,505.80
Similarly, the interest for the second and third years can be calculated using the same formula. However, as the balance payable becomes zero after the second installment, there will be no interest charged for the third year.
Calculation of Depreciation:
The depreciation is written off at 10% p.a. using the written down value method. The written down value at the beginning of each year is calculated by subtracting the depreciation for the previous year from the value at the beginning of the previous year.
Depreciation for the first year = Hire purchase price * Depreciation rate
= Rs. 73,470 * 10%
= Rs. 7,347
Written down value at the beginning of the second year = Hire purchase price - Depreciation for the first year
= Rs. 73,470 - Rs. 7,347
= Rs. 66,123
Similarly, the written down value at the beginning of the third year can be calculated using the same formula.
Summary:
- The hire purchase price of the motor truck is Rs. 73,470.
- The annual installment is Rs. 17,823.33.
- The interest for the first year is Rs. 2,505.80.
- The interest for the second year is calculated using the same formula and is Rs. 1,051.20.
- There is no interest charged for the third year.
- The depreciation for the first year is Rs. 7,347.
- The written down value at the beginning of the second year is Rs. 66,123.
- The written down value at the beginning of the third year can be calculated using the same formula.
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On 1 Apr 2008 Krishna transport company purchase motor truck Rajasthan...
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On 1 Apr 2008 Krishna transport company purchase motor truck Rajasthan motor l.t.d on hire purchase basis of which was Rs.73470 ; Rs.20000 was paid as immediate deposit and the balance was payable in three equal installments of Rs.20000 each on 31 March each year , interest is to be charged at 6% per annum depreciation was written off @10% p.a. on wtitten down value mathod?
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On 1 Apr 2008 Krishna transport company purchase motor truck Rajasthan motor l.t.d on hire purchase basis of which was Rs.73470 ; Rs.20000 was paid as immediate deposit and the balance was payable in three equal installments of Rs.20000 each on 31 March each year , interest is to be charged at 6% per annum depreciation was written off @10% p.a. on wtitten down value mathod? for B Com 2024 is part of B Com preparation. The Question and answers have been prepared according to the B Com exam syllabus. Information about On 1 Apr 2008 Krishna transport company purchase motor truck Rajasthan motor l.t.d on hire purchase basis of which was Rs.73470 ; Rs.20000 was paid as immediate deposit and the balance was payable in three equal installments of Rs.20000 each on 31 March each year , interest is to be charged at 6% per annum depreciation was written off @10% p.a. on wtitten down value mathod? covers all topics & solutions for B Com 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for On 1 Apr 2008 Krishna transport company purchase motor truck Rajasthan motor l.t.d on hire purchase basis of which was Rs.73470 ; Rs.20000 was paid as immediate deposit and the balance was payable in three equal installments of Rs.20000 each on 31 March each year , interest is to be charged at 6% per annum depreciation was written off @10% p.a. on wtitten down value mathod?.
On 1 Apr 2008 Krishna transport company purchase motor truck Rajasthan motor l.t.d on hire purchase basis of which was Rs.73470 ; Rs.20000 was paid as immediate deposit and the balance was payable in three equal installments of Rs.20000 each on 31 March each year , interest is to be charged at 6% per annum depreciation was written off @10% p.a. on wtitten down value mathod? for B Com 2024 is part of B Com preparation. The Question and answers have been prepared according to the B Com exam syllabus. Information about On 1 Apr 2008 Krishna transport company purchase motor truck Rajasthan motor l.t.d on hire purchase basis of which was Rs.73470 ; Rs.20000 was paid as immediate deposit and the balance was payable in three equal installments of Rs.20000 each on 31 March each year , interest is to be charged at 6% per annum depreciation was written off @10% p.a. on wtitten down value mathod? covers all topics & solutions for B Com 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for On 1 Apr 2008 Krishna transport company purchase motor truck Rajasthan motor l.t.d on hire purchase basis of which was Rs.73470 ; Rs.20000 was paid as immediate deposit and the balance was payable in three equal installments of Rs.20000 each on 31 March each year , interest is to be charged at 6% per annum depreciation was written off @10% p.a. on wtitten down value mathod?.
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