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X purchased a machine on Hire purchased system.The total cash price of the machine is 31960.down payment 8000 and three installments of 12000,10000,4000,payable at the end of the first second third year's respectively. Interest is charged 5%p.a .charge depreciation at 10% on straight line method.prepare ledger accounts in the books of x?
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X purchased a machine on Hire purchased system.The total cash price of...
Ledger Accounts in Books of X for Hire Purchase System

Cash Price of the Machine:
The total cash price of the machine is 31960.

Down Payment:
X made a down payment of 8000.

Installments:
X paid three installments of 12000,10000,4000, payable at the end of the first, second, and third year's respectively.

Interest:
Interest is charged at 5%p.a.

Depreciation:
X charged depreciation at 10% on straight line method.

Preparation of Ledger Accounts:

1. Machinery Account:
Debit Side:
Cash Price of the Machine - 31960

Credit Side:
By Hire Purchase Account - 23960
By Depreciation Account - 8000

2. Hire Purchase Account:
Debit Side:
By Machinery Account - 23960
By Interest Account - Year 1 - 1198
By Interest Account - Year 2 - 998
By Interest Account - Year 3 - 398

Credit Side:
By Down Payment - 8000
By First Installment - 12000
By Second Installment - 10000
By Third Installment - 4000

3. Interest Account:
Debit Side:
By Hire Purchase Account - Year 1 - 1198
By Hire Purchase Account - Year 2 - 998
By Hire Purchase Account - Year 3 - 398

Credit Side:
Nil

4. Depreciation Account:
Debit Side:
By Machinery Account - 8000

Credit Side:
Nil

Conclusion:

The above ledger accounts show how X made a down payment and paid three installments for a machine on Hire Purchase System. X also charged depreciation at 10% on straight line method and paid interest at 5%p.a. The ledger accounts have been prepared in accordance with the accounting standards and principles.
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X purchased a machine on Hire purchased system.The total cash price of...
‘X’ purchased a machine on hire purchased system. The total cash price of the machine is `31,960. Down payment `8,000and three installments of `12,000, `10,000, `4,000 payable atthe end of the first, second and third years respectively.Interest is charged 5% p.a. Charge depreciation at 10% on straight line method. Prepare ledger accounts in the books of‘X
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X purchased a machine on Hire purchased system.The total cash price of the machine is 31960.down payment 8000 and three installments of 12000,10000,4000,payable at the end of the first second third year's respectively. Interest is charged 5%p.a .charge depreciation at 10% on straight line method.prepare ledger accounts in the books of x?
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X purchased a machine on Hire purchased system.The total cash price of the machine is 31960.down payment 8000 and three installments of 12000,10000,4000,payable at the end of the first second third year's respectively. Interest is charged 5%p.a .charge depreciation at 10% on straight line method.prepare ledger accounts in the books of x? 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 X purchased a machine on Hire purchased system.The total cash price of the machine is 31960.down payment 8000 and three installments of 12000,10000,4000,payable at the end of the first second third year's respectively. Interest is charged 5%p.a .charge depreciation at 10% on straight line method.prepare ledger accounts in the books of x? covers all topics & solutions for B Com 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for X purchased a machine on Hire purchased system.The total cash price of the machine is 31960.down payment 8000 and three installments of 12000,10000,4000,payable at the end of the first second third year's respectively. Interest is charged 5%p.a .charge depreciation at 10% on straight line method.prepare ledger accounts in the books of x?.
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