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A company leased a colliery on 1-1-2012 at a minimum rent of rs 20,000 merging into a royalty of Rs 1.50 per tone with power to recoup short workings over the first four years of the lease. The output of the colliery for the first four years was 9,000 tones , 12,000 tones, 16,000 tonnes and 20,000 tonnes respectively. Prepare the necessary ledger accounts in book of Lessee?
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A company leased a colliery on 1-1-2012 at a minimum rent of rs 20,000...
Lease Accounting
Lease
- Dr. Leasehold Premises A/c..........................................20,000
To Bank A/c..............................................................20,000 (Being payment made for leasehold premises on 1-1-2012)
Royalty
- Dr. Royalty A/c.............................................................18,500
(9,000 * 1.5 + 12,000 * 1.5 + 16,000 * 1.5 + 20,000 * 1.5)
To Colliery Output A/c.................................................18,500
(Being royalty paid on colliery output for the first four years of the lease)
Recoupment of Short Workings
- Dr. Short Workings A/c..............................................4,500
(20,000 - 9,000 - 12,000 - 16,000) * 1.5
To Colliery Output A/c................................................4,500
(Being short workings recouped from the colliery output for the first four years of the lease)
Explanation:
- The company leased a colliery on 1-1-2012 at a minimum rent of Rs 20,000 merging into a royalty of Rs 1.50 per tone with power to recoup short workings over the first four years of the lease.
- The output of the colliery for the first four years was 9,000 tones, 12,000 tones, 16,000 tonnes and 20,000 tonnes respectively.
- The necessary ledger accounts in the book of Lessee are the Lease, Royalty, and Recoupment of Short Workings accounts.
- The Lease account is debited with Rs 20,000, which is the payment made for the leasehold premises on 1-1-2012.
- The Royalty account is debited with Rs 18,500, which is the total royalty paid on colliery output for the first four years of the lease (9,000 * 1.5 + 12,000 * 1.5 + 16,000 * 1.5 + 20,000 * 1.5).
- The Colliery Output account is credited with Rs 18,500, which is the total royalty paid on colliery output for the first four years of the lease.
- The Recoupment of Short Workings account is debited with Rs 4,500, which is the short workings recouped from the colliery output for the first four years of the lease (20,000 - 9,000 - 12,000 - 16,000) * 1.5).
- The Colliery Output account is credited with Rs 4,500, which is the short workings recouped from the colliery output for the first four years of the lease.
- In summary, the Lessee's books show the lease payment, royalty, and recoupment of short workings over the first four years of the lease.
Lease
- Dr. Leasehold Premises A/c..........................................20,000
To Bank A/c..............................................................20,000 (Being payment made for leasehold premises on 1-1-2012)
Royalty
- Dr. Royalty A/c.............................................................18,500
(9,000 * 1.5 + 12,000 * 1.5 + 16,000 * 1.5 + 20,000 * 1.5)
To Colliery Output A/c.................................................18,500
(Being royalty paid on colliery output for the first four years of the lease)
Recoupment of Short Workings
- Dr. Short Workings A/c..............................................4,500
(20,000 - 9,000 - 12,000 - 16,000) * 1.5
To Colliery Output A/c................................................4,500
(Being short workings recouped from the colliery output for the first four years of the lease)
Explanation:
- The company leased a colliery on 1-1-2012 at a minimum rent of Rs 20,000 merging into a royalty of Rs 1.50 per tone with power to recoup short workings over the first four years of the lease.
- The output of the colliery for the first four years was 9,000 tones, 12,000 tones, 16,000 tonnes and 20,000 tonnes respectively.
- The necessary ledger accounts in the book of Lessee are the Lease, Royalty, and Recoupment of Short Workings accounts.
- The Lease account is debited with Rs 20,000, which is the payment made for the leasehold premises on 1-1-2012.
- The Royalty account is debited with Rs 18,500, which is the total royalty paid on colliery output for the first four years of the lease (9,000 * 1.5 + 12,000 * 1.5 + 16,000 * 1.5 + 20,000 * 1.5).
- The Colliery Output account is credited with Rs 18,500, which is the total royalty paid on colliery output for the first four years of the lease.
- The Recoupment of Short Workings account is debited with Rs 4,500, which is the short workings recouped from the colliery output for the first four years of the lease (20,000 - 9,000 - 12,000 - 16,000) * 1.5).
- The Colliery Output account is credited with Rs 4,500, which is the short workings recouped from the colliery output for the first four years of the lease.
- In summary, the Lessee's books show the lease payment, royalty, and recoupment of short workings over the first four years of the lease.
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A company leased a colliery on 1-1-2012 at a minimum rent of rs 20,000 merging into a royalty of Rs 1.50 per tone with power to recoup short workings over the first four years of the lease. The output of the colliery for the first four years was 9,000 tones , 12,000 tones, 16,000 tonnes and 20,000 tonnes respectively. Prepare the necessary ledger accounts in book of Lessee?
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A company leased a colliery on 1-1-2012 at a minimum rent of rs 20,000 merging into a royalty of Rs 1.50 per tone with power to recoup short workings over the first four years of the lease. The output of the colliery for the first four years was 9,000 tones , 12,000 tones, 16,000 tonnes and 20,000 tonnes respectively. Prepare the necessary ledger accounts in book of Lessee? for CA Foundation 2024 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about A company leased a colliery on 1-1-2012 at a minimum rent of rs 20,000 merging into a royalty of Rs 1.50 per tone with power to recoup short workings over the first four years of the lease. The output of the colliery for the first four years was 9,000 tones , 12,000 tones, 16,000 tonnes and 20,000 tonnes respectively. Prepare the necessary ledger accounts in book of Lessee? covers all topics & solutions for CA Foundation 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for A company leased a colliery on 1-1-2012 at a minimum rent of rs 20,000 merging into a royalty of Rs 1.50 per tone with power to recoup short workings over the first four years of the lease. The output of the colliery for the first four years was 9,000 tones , 12,000 tones, 16,000 tonnes and 20,000 tonnes respectively. Prepare the necessary ledger accounts in book of Lessee?.
A company leased a colliery on 1-1-2012 at a minimum rent of rs 20,000 merging into a royalty of Rs 1.50 per tone with power to recoup short workings over the first four years of the lease. The output of the colliery for the first four years was 9,000 tones , 12,000 tones, 16,000 tonnes and 20,000 tonnes respectively. Prepare the necessary ledger accounts in book of Lessee? for CA Foundation 2024 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about A company leased a colliery on 1-1-2012 at a minimum rent of rs 20,000 merging into a royalty of Rs 1.50 per tone with power to recoup short workings over the first four years of the lease. The output of the colliery for the first four years was 9,000 tones , 12,000 tones, 16,000 tonnes and 20,000 tonnes respectively. Prepare the necessary ledger accounts in book of Lessee? covers all topics & solutions for CA Foundation 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for A company leased a colliery on 1-1-2012 at a minimum rent of rs 20,000 merging into a royalty of Rs 1.50 per tone with power to recoup short workings over the first four years of the lease. The output of the colliery for the first four years was 9,000 tones , 12,000 tones, 16,000 tonnes and 20,000 tonnes respectively. Prepare the necessary ledger accounts in book of Lessee?.
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A company leased a colliery on 1-1-2012 at a minimum rent of rs 20,000 merging into a royalty of Rs 1.50 per tone with power to recoup short workings over the first four years of the lease. The output of the colliery for the first four years was 9,000 tones , 12,000 tones, 16,000 tonnes and 20,000 tonnes respectively. Prepare the necessary ledger accounts in book of Lessee?, a detailed solution for A company leased a colliery on 1-1-2012 at a minimum rent of rs 20,000 merging into a royalty of Rs 1.50 per tone with power to recoup short workings over the first four years of the lease. The output of the colliery for the first four years was 9,000 tones , 12,000 tones, 16,000 tonnes and 20,000 tonnes respectively. Prepare the necessary ledger accounts in book of Lessee? has been provided alongside types of A company leased a colliery on 1-1-2012 at a minimum rent of rs 20,000 merging into a royalty of Rs 1.50 per tone with power to recoup short workings over the first four years of the lease. The output of the colliery for the first four years was 9,000 tones , 12,000 tones, 16,000 tonnes and 20,000 tonnes respectively. Prepare the necessary ledger accounts in book of Lessee? theory, EduRev gives you an
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