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The balance of Machinery Account of a firm on 1st April, 2020 was Rs 28,54,000 Out of this, a plant having book value of Rs. 216,090 as on 1st April, 2020 was sold on 1st July, 2020 for Rs. 82,000 On the same date a new plant was purchased for Rs 458,000 and R 22,000 was spent on its erection. On 1st November 2020 a new machine was purchased for Rs 560.000. Depreciation is written off 15% per annum under the diminishing Calculate the deparation for her ended March, 2021?
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The balance of Machinery Account of a firm on 1st April, 2020 was Rs 2...
Depreciation Calculation for the Year Ended March 2021:
Opening Balance of Machinery Account as on 1st April 2020 = Rs 28,54,000
Less: Sale of Plant (Book Value of Rs 216,090) on 1st July 2020 = Rs 82,000
Add: Purchase of New Plant on 1st July 2020 = Rs 458,000
Add: Erection Expenses of New Plant = Rs 22,000
Add: Purchase of New Machine on 1st November 2020 = Rs 560,000
Closing Balance of Machinery Account as on 31st March 2021 = Rs 30,672,000
Depreciation Rate: 15% per annum under the diminishing balance method
Calculation of Depreciation for the Year Ended March 2021:
Depreciation on Opening Balance of Machinery Account as on 1st April 2020 = Rs 428,100 (15% of Rs 28,54,000)
Depreciation on New Plant (Rs 458,000 - Rs 22,000) purchased on 1st July 2020 for 9 months = Rs 29,640 [(15% / 12) * 9 * Rs 436,000]
Depreciation on New Machine purchased on 1st November 2020 for 5 months = Rs 46,667 [(15% / 12) * 5 * Rs 560,000]
Total Depreciation for the Year Ended March 2021 = Rs 504,407
Explanation:
The question provides information about the opening and closing balance of the Machinery Account, sale and purchase of plants and machines during the year, and the depreciation rate to be applied. We need to use the diminishing balance method to calculate the depreciation for the year ended March 2021.
We start by adjusting the opening balance of the Machinery Account for the sale of the plant and purchase of new plant and machine during the year. We then apply the depreciation rate to the opening balance to calculate the depreciation on the old machinery for the year.
Next, we calculate the depreciation on the new plant and machine purchased during the year. Since these assets were not available for the entire year, we need to calculate the depreciation for the period they were available. We do this by using the formula for pro-rata depreciation, which takes into account the number of months the asset was available during the year.
Finally, we add up the depreciation on all assets to arrive at the total depreciation for the year ended March 2021. This amount will be charged to the Profit and Loss Account and reduces the value of the Machinery Account on the Balance Sheet.
Opening Balance of Machinery Account as on 1st April 2020 = Rs 28,54,000
Less: Sale of Plant (Book Value of Rs 216,090) on 1st July 2020 = Rs 82,000
Add: Purchase of New Plant on 1st July 2020 = Rs 458,000
Add: Erection Expenses of New Plant = Rs 22,000
Add: Purchase of New Machine on 1st November 2020 = Rs 560,000
Closing Balance of Machinery Account as on 31st March 2021 = Rs 30,672,000
Depreciation Rate: 15% per annum under the diminishing balance method
Calculation of Depreciation for the Year Ended March 2021:
Depreciation on Opening Balance of Machinery Account as on 1st April 2020 = Rs 428,100 (15% of Rs 28,54,000)
Depreciation on New Plant (Rs 458,000 - Rs 22,000) purchased on 1st July 2020 for 9 months = Rs 29,640 [(15% / 12) * 9 * Rs 436,000]
Depreciation on New Machine purchased on 1st November 2020 for 5 months = Rs 46,667 [(15% / 12) * 5 * Rs 560,000]
Total Depreciation for the Year Ended March 2021 = Rs 504,407
Explanation:
The question provides information about the opening and closing balance of the Machinery Account, sale and purchase of plants and machines during the year, and the depreciation rate to be applied. We need to use the diminishing balance method to calculate the depreciation for the year ended March 2021.
We start by adjusting the opening balance of the Machinery Account for the sale of the plant and purchase of new plant and machine during the year. We then apply the depreciation rate to the opening balance to calculate the depreciation on the old machinery for the year.
Next, we calculate the depreciation on the new plant and machine purchased during the year. Since these assets were not available for the entire year, we need to calculate the depreciation for the period they were available. We do this by using the formula for pro-rata depreciation, which takes into account the number of months the asset was available during the year.
Finally, we add up the depreciation on all assets to arrive at the total depreciation for the year ended March 2021. This amount will be charged to the Profit and Loss Account and reduces the value of the Machinery Account on the Balance Sheet.
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The balance of Machinery Account of a firm on 1st April, 2020 was Rs 28,54,000 Out of this, a plant having book value of Rs. 216,090 as on 1st April, 2020 was sold on 1st July, 2020 for Rs. 82,000 On the same date a new plant was purchased for Rs 458,000 and R 22,000 was spent on its erection. On 1st November 2020 a new machine was purchased for Rs 560.000. Depreciation is written off 15% per annum under the diminishing Calculate the deparation for her ended March, 2021?
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The balance of Machinery Account of a firm on 1st April, 2020 was Rs 28,54,000 Out of this, a plant having book value of Rs. 216,090 as on 1st April, 2020 was sold on 1st July, 2020 for Rs. 82,000 On the same date a new plant was purchased for Rs 458,000 and R 22,000 was spent on its erection. On 1st November 2020 a new machine was purchased for Rs 560.000. Depreciation is written off 15% per annum under the diminishing Calculate the deparation for her ended March, 2021? 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 The balance of Machinery Account of a firm on 1st April, 2020 was Rs 28,54,000 Out of this, a plant having book value of Rs. 216,090 as on 1st April, 2020 was sold on 1st July, 2020 for Rs. 82,000 On the same date a new plant was purchased for Rs 458,000 and R 22,000 was spent on its erection. On 1st November 2020 a new machine was purchased for Rs 560.000. Depreciation is written off 15% per annum under the diminishing Calculate the deparation for her ended March, 2021? covers all topics & solutions for CA Foundation 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for The balance of Machinery Account of a firm on 1st April, 2020 was Rs 28,54,000 Out of this, a plant having book value of Rs. 216,090 as on 1st April, 2020 was sold on 1st July, 2020 for Rs. 82,000 On the same date a new plant was purchased for Rs 458,000 and R 22,000 was spent on its erection. On 1st November 2020 a new machine was purchased for Rs 560.000. Depreciation is written off 15% per annum under the diminishing Calculate the deparation for her ended March, 2021?.
The balance of Machinery Account of a firm on 1st April, 2020 was Rs 28,54,000 Out of this, a plant having book value of Rs. 216,090 as on 1st April, 2020 was sold on 1st July, 2020 for Rs. 82,000 On the same date a new plant was purchased for Rs 458,000 and R 22,000 was spent on its erection. On 1st November 2020 a new machine was purchased for Rs 560.000. Depreciation is written off 15% per annum under the diminishing Calculate the deparation for her ended March, 2021? 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 The balance of Machinery Account of a firm on 1st April, 2020 was Rs 28,54,000 Out of this, a plant having book value of Rs. 216,090 as on 1st April, 2020 was sold on 1st July, 2020 for Rs. 82,000 On the same date a new plant was purchased for Rs 458,000 and R 22,000 was spent on its erection. On 1st November 2020 a new machine was purchased for Rs 560.000. Depreciation is written off 15% per annum under the diminishing Calculate the deparation for her ended March, 2021? covers all topics & solutions for CA Foundation 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for The balance of Machinery Account of a firm on 1st April, 2020 was Rs 28,54,000 Out of this, a plant having book value of Rs. 216,090 as on 1st April, 2020 was sold on 1st July, 2020 for Rs. 82,000 On the same date a new plant was purchased for Rs 458,000 and R 22,000 was spent on its erection. On 1st November 2020 a new machine was purchased for Rs 560.000. Depreciation is written off 15% per annum under the diminishing Calculate the deparation for her ended March, 2021?.
Solutions for The balance of Machinery Account of a firm on 1st April, 2020 was Rs 28,54,000 Out of this, a plant having book value of Rs. 216,090 as on 1st April, 2020 was sold on 1st July, 2020 for Rs. 82,000 On the same date a new plant was purchased for Rs 458,000 and R 22,000 was spent on its erection. On 1st November 2020 a new machine was purchased for Rs 560.000. Depreciation is written off 15% per annum under the diminishing Calculate the deparation for her ended March, 2021? in English & in Hindi are available as part of our courses for CA Foundation.
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