Give the machinery account for four years.
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- Akshat enterprises purchased on 1st April 2014, a machine for 7,28,000 and spent Rs 22,000 on its installation. It purchased another machinery for Rs 2,50,000 on 1st October 2014. On 1st October 2016, the first machine sold for 4,50,000. It purchased another machinery on the same date for Rs 6,00,000. Depreciation was provided annually on 31st March at 10% p.a. on the written down value. On 1st April 2017, the firm decided to change the method of charging depreciation and adopted the method of providing depreciation @ 10% p.a. on the straight line basis as per AS- 10 (Revised), Property, Plant and Equipment. Prepare machinery account from 1st April 2014 to 31st March 2018.On 1st Jan 2017,a company purchased a machine costing Rs. 500,000. Its estimated workinglife is 20 years at the end of which it will fetch Rs. 20000. Additions are made on 1st January2018 and 1st July 2019 to the value of Rs. 80,000 (scrap value Rs. 4000) and Rs. 40000(scrapvalue Rs. 2000) respectively. The life of both new machines is 20 years. Show machine A/c forfirst four years.vardhaman traders purchased a machinery on 4.4.2019 at a price of rs 250000 and paid rs50000 on the carriage of the machinery to bring it to the factory premises. the management decides that charging depreciation as per the wdv method will make more sense. it was decided that – the depreciation would be charged @15% on wdv method the useful life of the machinery is 5 years the machinery has been disposed off at the completion of 3 years at a value of rs200000 required- discuss the concept of charging depreciation through wdv method. calculate the closing wdv and depreciation for all the first three years. calculate the profit and loss, if any on the disposal of the asset is this possible for any business entity to change the method of charging depreciation
- M/s. Caps Lock purchased a new machine on 1st Jan 2017 for Rs.3,20,000 and also incurred Rs.80,000 on its installation. Another machine was purchased on 1st July 2017 for Rs.1,60,000. On 1st July 2019, the machinery purchased on 1st January 2017 was sold for Rs.2,50,000. Another machine was purchased and installed on 30th September 2019 for Rs.60,000. The company provides for depreciation @ 10% p.a on Original Cost till 2019. From the year 2020 it decided to adapt to WDV method and charge depreciation @ 15% p.a. You are required to show Machinery Account for the year 2019 & 2020 considering the books are closed on 31st December each year.Mwakisha, a contractor, started business on 1 January 2018. Purchases and disposals of machines over the subsequent three years were as follows: Machine Date of Cost Date of Purchase Disposal Shs. MA 1 1 January 2018 5,000,000 MB 2 1 July 2019 2,500,000 1 June 2020 MC 3 1 October 2020 7,000,000 The machines are depreciated on straight line basis using a rate of 20 per cent per annum. Required: For the years 2018, 2019 and 2020, calculate the depreciation…The Aghfa Id purchased new machinery for Rs 1,400,000 with 6years estimated useful life andno salvage value, on 1s July, 2015.It's a company policy to charge depreciation @ 15% onreducing balance method. The company got 5% discount on machine cost due to special effortsof purchase manager. An additional engineer is hired to operate such machine at salary ofRs.50, 000 pm. As machine was imported so import duty @ 2% is charged on net purchase price.Installation and other expenses were Rs.600, 000 and Rs.100, 000 respectively. After installmentmanagement conducts initial testing that was cost Rs.150, 000 and scrap from testing wasrealized for Rs.20, 000. Marketing department estimates Rs.200, 000 for the promotion of newproduct.Requirement:1. Find total initial cost2.Prepare the depreciation schedule.
- J. Mwakisha, a contractor, started business on 1 January 2018. Purchases and disposals of machines over the subsequent three years were as follows: Machine date of purchase cost date of disposal MA 1 1 January 2018 5,000,000 MB 2 1 July 2019 2,500,000 1 June 2020 MC 3 1 October 2020 7,000,000 The machines are depreciated on straight line basis using a rate of 20 per cent per annum. Required: For the years 2018, 2019 and 2020, calculate the depreciation attributable to each year using prorata or time basis.Vardhaman Traders purchased a machinery on 4.4.2019 at a price of Rs 250000 and paid Rs50000 on the carriage of the machinery to bring it to the factory premises. Themanagement decides that charging depreciation as per the WDV method will make more sense.It was decided that –The depreciation would be charged @15% on WDV methodThe useful life of the machinery is 5 yearsThe machinery has been disposed off at the completion of 3 years at a value of Rs200000 Required- Discuss the concept of charging depreciation through WDV method. Calculate the closing WDV and depreciation for all the first three years. Calculate the profit and loss, if any on the disposal of the asset . Is this possible for any business entity to change the method of charging depreciationkavita purchased a machine for Rs. 80,000 on 1st April, 2015. She charged depreciation on SLM basis and closes her books on 31st December every year. The machine has auseful life of 8 years after which it can be sold for Rs. 8,000. She purchased another machine on 1st May, 2016 for Rs. 45,000 with 5 years useful life and nill residual value. In 2017, the first machine was sold for Rs. 50,000 on 30th June when a new machine was purchased for Rs. 30,000 with 3 years useful life and Rs. 3,000 as residual value. Prepare the machinery accounts for the 3 years ending December 31, 2017.
- Kavita purchased a machine for Rs. 80,000 on 1st April, 2015. She charges depreciation on SLM basis and closes her books on 31st December every year. The machine has a useful life of 8 years after which it can be sold for Rs. 8,000. She purchased another machine on 1st May, 2016 for Rs. 45,000 with 5 years useful life and nil residual value. In 2017, the first machine was sold for Rs. 50,000 on 30th June when a new machine was purchased for Rs. 30,000 with 3 years useful life and Rs. 3,000 as residual value. Prepare the machinery account for the 3 years ending December 31, 2017.VI. On January 1, 2017, Abraham SA purchased the following two machines for use in its production process. Machine A: The cash price of this machine was €55,000. Related expenditures included: sales tax €3,300, shipping costs €325, insurance during ship- ping €75, installation and testing costs €1,300, and €90 of oil and lubri- cants to be used with the machinery during its first year of operation. Abraham estimates that the useful life of the machine is 4 years with a €6,000 residual value remaining at the end of that time period. Machine B: The recorded cost of this machine was €130,000. Abraham estimates that the useful life of the machine is 5 years with a €10,000 residual value remaining at the end of that time period. Instructions (a) Prepare the following for Machine A. (1) The journal entry to record its purchase on January 1, 2017. (2) The journal entry to record annual depreciation at December 31, 2017, assuming the straight-line method of depreciation is used. (b) Calculate…On 1 November 2018, Graceville Ltd purchased an item of property, plant and equipment for $50 000. The terms of the purchase were as follows: $50 000 could be paid within 30 days, or $65 000 in one year’s time. The management of Graceville opted to pay $65 000 in one year’s time. Delivery and handling costs of $4 000 were incurred, as well as engineering fees of $1 200 to ensure that the asset was correctly installed. The asset began operations on 6 January 2019. During January, holding costs of $5 000 were incurred because the asset was operating at less than full capacity. In addition, $900 costs comprising labour and small parts were incurred in day-to-day servicing of the asset. Management of Graceville Ltd uses the revaluation model to account for the asset. Required Prepare any necessary general journal entry(ies) to initially record and measure the asset in accordance with the requirements of AASB 116 ‘Property, Plant and Equipment’.