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A firm purchased on 1st april 2010 a machinery for rs 400000. on 1st october in the same year a additional machinery was purchased costing rs 200000. on 1st october 2011 the machinery purchased on 1st april 2010 having become obsolete is sold for rs 180000. on 1st october 2012 a new machinery was purchased for rs 500000 and the machinery purchased on 1st october 2010 was sold at rs 170000 depreciation is to be provided at the rate of 10% per annum cost on 31st march every year?
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A firm purchased on 1st april 2010 a machinery for rs 400000. on 1st o...
Calculation of Depreciation

- Depreciation to be provided at the rate of 10% per annum on the cost of machinery.
- Cost of machinery on 1st April 2010 = Rs. 400,000
- Depreciation for the year ending 31st March 2011 = 10% of Rs. 400,000 = Rs. 40,000
- Cost of machinery on 31st March 2011 = Rs. 400,000 - Rs. 40,000 = Rs. 360,000
- Depreciation for the year ending 31st March 2012 = 10% of Rs. 360,000 = Rs. 36,000
- Cost of machinery on 31st March 2012 = Rs. 360,000 - Rs. 36,000 = Rs. 324,000
- Depreciation for the year ending 31st March 2013 = 10% of Rs. 324,000 = Rs. 32,400
- Cost of machinery on 31st March 2013 = Rs. 324,000 - Rs. 32,400 = Rs. 291,600

Accounting Treatment

- Purchase of machinery on 1st April 2010: Debit Machinery account with Rs. 400,000
- Purchase of machinery on 1st October 2010: Debit Machinery account with Rs. 200,000
- Sale of machinery on 1st October 2011: Credit Machinery account with Rs. 180,000 and Debit Profit and Loss account with Rs. 144,000 (i.e. Rs. 180,000 - Rs. 36,000 depreciation for 18 months)
- Purchase of machinery on 1st October 2012: Debit Machinery account with Rs. 500,000
- Sale of machinery on 1st October 2012: Credit Machinery account with Rs. 170,000 and Debit Profit and Loss account with Rs. 147,600 (i.e. Rs. 170,000 - Rs. 32,400 depreciation for 12 months)
- Depreciation for the year ending 31st March 2013: Debit Profit and Loss account with Rs. 32,400 and Credit Depreciation account with Rs. 32,400
- Cost of machinery on 31st March 2013: Debit Machinery account with Rs. 291,600

Calculation of Cost on 31st March every year

- Cost of machinery on 31st March 2011: Rs. 360,000 (i.e. Rs. 400,000 - Rs. 40,000 depreciation for 1 year)
- Cost of machinery on 31st March 2012: Rs. 324,000 (i.e. Rs. 360,000 - Rs. 36,000 depreciation for 1 year)
- Cost of machinery on 31st March 2013: Rs. 291,600 (i.e. Rs. 324,000 - Rs. 32,400 depreciation for 1 year)
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A firm purchased on 1st april 2010 a machinery for rs 400000. on 1st o...
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A firm purchased on 1st april 2010 a machinery for rs 400000. on 1st october in the same year a additional machinery was purchased costing rs 200000. on 1st october 2011 the machinery purchased on 1st april 2010 having become obsolete is sold for rs 180000. on 1st october 2012 a new machinery was purchased for rs 500000 and the machinery purchased on 1st october 2010 was sold at rs 170000 depreciation is to be provided at the rate of 10% per annum cost on 31st march every year?
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A firm purchased on 1st april 2010 a machinery for rs 400000. on 1st october in the same year a additional machinery was purchased costing rs 200000. on 1st october 2011 the machinery purchased on 1st april 2010 having become obsolete is sold for rs 180000. on 1st october 2012 a new machinery was purchased for rs 500000 and the machinery purchased on 1st october 2010 was sold at rs 170000 depreciation is to be provided at the rate of 10% per annum cost on 31st march every year? 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 A firm purchased on 1st april 2010 a machinery for rs 400000. on 1st october in the same year a additional machinery was purchased costing rs 200000. on 1st october 2011 the machinery purchased on 1st april 2010 having become obsolete is sold for rs 180000. on 1st october 2012 a new machinery was purchased for rs 500000 and the machinery purchased on 1st october 2010 was sold at rs 170000 depreciation is to be provided at the rate of 10% per annum cost on 31st march every year? covers all topics & solutions for B Com 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for A firm purchased on 1st april 2010 a machinery for rs 400000. on 1st october in the same year a additional machinery was purchased costing rs 200000. on 1st october 2011 the machinery purchased on 1st april 2010 having become obsolete is sold for rs 180000. on 1st october 2012 a new machinery was purchased for rs 500000 and the machinery purchased on 1st october 2010 was sold at rs 170000 depreciation is to be provided at the rate of 10% per annum cost on 31st march every year?.
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