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A firm purchased an old truck for Rs 2,0...

A firm purchased an old truck for Rs 2,00,000 on 1st April, 2016. It charged depreciation `"@ " 20%` per annum following Written Down Value Method. The truck was sold on 1st October, 2017 for Rs 1,60,000. Prepare Truck Account for the years ending 31st March, 2017 and 2018.

Text Solution

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Gain (Profit) on Sale of Truck = Sale Proceeds-Book Value of Truck on date of Sale
=Rs 1,60,000-(Rs 1,60,000-Rs 16,000)=Rs 16,000.
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