Asset Disposal Account|Depreciation|Questions

Use Of Assets Disposal Account

Traditional Classification of Accounts|Personal Accounts|Impersonal Accounts|Questions

M/s Mehra and Sons acquired a machine for Rs . 1,80,000 on October 01,2016 and spent Rs . 20,000 for its installation. The firm writes -off depreciation at the rate of 10% on original Account and Depreciation Account ofr first three years given that : (i) The book of accounts closes on March 31 every year, and (ii) The firm charges depreciation to aseset account.

On April 01, 2010, Bajrang Marbles purchased a Machine for Rs. 1,80,000 and spent Rs. 10,000 on it s carriage and Rs. on its installation. It is estimated that its working life is 10 years and after 10 years its scrap value will be Rs. 20,000 (a) Prepare Machine account and Depreciation account for the first four years by providing depreciation on straight line method. Accounts are closed on March 31st every year (b) Prepare Machine account, Depreciation account and Provision for depreciation account (or accumulated depreciation account) for the first four years by providing depreciation using straight line method accounts are closed on March 31 every year.