Class 11th Chapter 7 Depreciation | Along with Calculator Tool
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1. On 1st April 2015 Farid of Nasik purchased a Motor car for ₹55,000. The scrap value of the motor Car was estimated at ₹10,000 and its estimated life is 10years The Registration charges of the Motor Car is ₹5,000. Show Motor car Account for the first years, assuming that the books of accounts are closed on 31st march every year.
2. On 1st Jan 2017 'Sai Industries Nagpur, purchased a Machine costing ₹1,65,000 and spent ₹15,000 for its installation charges. the estimated life of the machine is to be 10 years and the scrap value at the end of its life would be ₹30,000. On 1st Oct 2018 the entire Machine was sold for ₹1,50,000. Show Machinery Account, Depreciation Account for the years 2016-2017, 2017-2018 and 2018-2019, assuming that the accounts are closed on 31st March every year.
3. Shubhangi Trading Company of Dombivli purchased machinery for ₹86,000 on 1st Jan 2016 and immediately spent ₹4,000 on its fixation and erection. On 1st Oct 2016 additional Machinery costing ₹40,000 was purchased. On 1st Oct 2017 the Machinery purchased on 1st Jan 2016 became obsolete and was sold for ₹70,000. On 1st 2017 a new Machinery was also purchased for ₹45,000. Depreciation was provided annually on 31st March at the rate of 12% per annum on fixed instalment method. Prepare Machinery Account for three years and pass Journal Entries for Third year i.e. 2017-2018.
4. On 1st Jan 2015, Triveni Traders Raigad purchased a Plant for ₹12,000, and installation charges being 43,000. On 1st July 2016 another Plant was purchased for ₹25,000, on 1st April 2017 another Plant was purchased for 427,000, wages paid for installation amounted to 42,000. Carriage paid for the Plant amounted to ₹1,000. Show Plant Account up to 31st March 2018 assuming that the rate of depreciation is @10%p.a. on Straight Line Method.
5. Sameer & Company, Mumbai purchased a Machine worth ₹2,00,000 on 1st April 2016. On 1st July 2017, the company purchased an additional Machine for ₹40,000. On 31st March 2019, the company old the Machine purchased on 1st July 2017 for ₹35,000. Company writes off depreciation at the rate of 10% on the original cost and the books of accounts are closed every year on 31st march. Show the Machinery Account and Depreciation Account for the first three years ending 31st March 2016-17, 2017-18 and 2018-19
Samarth Manufacturing C. ltd, Aurangabad, purchased a new Machinery for ₹45,000 on 1t Jan 2015amd immediately spent ₹5,000 on its fixation and erection. In the same year 1st July additional Machinery costing ₹25,000 was purchased. On 1st July 2016 the Machinery purchased on 1st Jan 2015 became obsolete and was sold for ₹40,000. Depreciation was provided for annually on 31st March at the rate of 10% per annum on fixed Instalment Method. You are required to prepare Machinery Account for the year 2014-15, 2015-16, 2016-17.
Practical Problems on Written Down Value Method
1. M/s Omkar Enterprise Jalgoan acquired a printing machine for ₹75,000 on 1st Oct 2015 and spent ₹5,000 on its transport and installation. Another Machine for ₹45,000 was purchased on 1st Jan 2017. Depreciation is charged at the rate of 20% on written Down Value Method, on 31st march every year. Prepare Printing Machine Account for the first four years.
2. Vishal Company, Dhule, purchased Machinery costing ₹60,000 on 1st April 2016. They purchased further Machinery on 1st October 2017, costing ₹30,000 and on 1st July 2018, costing ₹20,000. On 1st Jan 2019, one-third of the Machinery, which was purchased on 1st April 2016, became obsolete and it was sold for ₹18,000.
Assume that, company account closes on 31st March every year. Show Machinery Account for the first three(3) years and pass journal entries for third year, after charging depreciation at 10% p.a. on Written Down Value Method.
3. Mahesh traders Solapur purchased furniture on 1st April 2014 for ₹20,000. In the same year on 1st Oct additional furniture was purchased for ₹10,000. On 1st Oct 2015, the Furniture purchased on 1st April 2014 was sold for ₹15,000 and on the same day a new Furniture was purchased for ₹20,000. The firm charged depreciation at 10% p.a. on Reducing Balance Method. Prepare Furniture Account and Depreciation Account for the year ending 31st March 2015, 2016 and 2017.
4. Radhika-Masale Amravati purchased a Plant on 1st Jan 2015 for ₹80,000. A new Plant was also purchased for ₹60,000, installation expenses being 410,000 on 1st April 2016. On 1st Jan 2017, a new Plant was purchased for ₹20,000, by disposing-off the 1st Plant at ₹60,000. Prepare Plant Account and depreciation Account for 31st March 2015, 31st March 2016 and 31st March 2017, assuming that the rate of depreciation was @10% on Diminishing Balance Method.
5. On 1st April 2015 Suman Traders purchased machinery for ₹30,000. On 1st Oct 2015, they purchased further Machinery costing ₹20,000. On 1st Oct 2016 they sold the Machine purchased on 1st April 2015 for ₹18,000 and brought another Machine for ₹15,000 on the same date. Depreciation is provided on Machinery @20% p.a. on the Diminishing balance Method and financial year closing on 31st March every year. Prepare the Machinery Account and Depreciation account for the year 2015-16, 2016-17 and 2017-18.