(a) Kavita purchased a machine for 780,000 on 1st April 2015. She charges depreciation on Straight Line Method and closes her books on December 31st every year. The machine has a useful life of 8 years after which it can be sold for 18,000. She purchased another machine on May 1st 2016 for 745,000 with 5 years useful life and nil residual value. In 2017, the first machine was sold for 50,000 on June 30th when a new machine was purchased for 30,000 with 3 years useful life and 3,000 as residual value. Prepare the machinery account for the 3 years ending December 31, 2017.

(a) Kavita purchased a machine for 780,000 on 1st April 2015. She charges depreciation on Straight Line Method and closes her books on December 31st every year. The machine has a useful life of 8 years after which it can be sold for 18,000. She purchased another machine on May 1st 2016 for 745,000 with 5 years useful life and nil residual value. In 2017, the first machine was sold for 50,000 on June 30th when a new machine was purchased for 30,000 with 3 years useful life and 3,000 as residual value. Prepare the machinery account for the 3 years ending December 31, 2017.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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