The book value of furniture on 1st April 2018 is Rs 60,000. Half of this furniture is sold for Rs. 20,000 on 30 th september 2018 Depreciation is to be charged on furniture `"@" 10%` p.a.
Calculate loss on sale of furniture. Show how the loss on sale and depreciation on furniture will be show in the income and Expenditure Account for the year ended 31st march 2019.

Answer

Written Down value of Furniture on the date of sale (30th september 2018) =Rs 30,000-Rs 1,500 (Depreciation for 6 Months)= Rs 28,500. Therefore loss on sale of furniture =Rs 28,500 -Rs 20,000 =Rs 8,500. Total Depreciation Rs 4,500 i.e., on Rs 30,000 `"@"10%` for full year and on Rs 30,000 `"@"10%` for half year.

Explanation

N/a