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.

Q: Pharoah Company owns equipment that cost $71.000 when purchased on January 1, 2019. It has been…

A: In case of multiple subparts, we are allowed to solve only the first 3 subparts. If you want the…

Q: Kingbird Manufacturing owns equipment that cost €65,100 when purchased on January 1, 2017. It has…

A: (a) Sold for €41,160 on January 1, 2020. No depreciation will be charged on January 1, 2020 (b)…

Q: Willis Company trades in a printing press for a newer model. The cost of the old printing press was…

A: This is a case of asset exchange, and exchanges having commercial substance are recorded at fair…

Q: cquire the land, Snow Company paid a P15,000 commission to a real estate agent. P25,000 were…

A: Land D   Particulars Amount Purchase Price 220,000 Agent's Commission 15,000 Cost of…

Q: SABM Co. acquired a machine on January 1, 2018, at a cost of P120,000. It was expected to have a…

A: Revaluation account is prepared for the revaluing of fixed assets and helps in record the accurate…

Q: BA Manufacturing Bhd. purchased an equipment for its factory on 1 January 2015. The cost of the…

A: Depreciation: A charge on the fixed asset that reduces the value of the asset is known as…

Q: Carolina Co. purchased a machine at a cost of $780,000 on January 1, 2016. On January 1, 2021, the…

A: Answer : Transaction has commercial Substance   DATE PARTICULAR DEBIT CREDIT         Jan 1,…

Q: Neptune Trading bought a new motor vehicle worth RM350,000 on 1 January 2019. The motor vehicle is…

A: The depreciation expense is charged on fixed assets as reduced value of the fixed asset with usage…

Q: Liam acquired a machinery purchased for P 1,100,000.00 and paid for transportation charge of P…

A: Depreciation: Depreciation means the reduction in the value of an asset over the life of the assets…

Q: J. Mwakisha, a contractor, started business on 1 January 2018. Purchases and disposals of machines…

A: Depreciation is a reduction in the value of assets due to the usage of that asset. We can evaluate…

Q: Podey Company has a machine that originally cost $20,000, has accumulated depreciation of $14,000 at…

A: Depreciation: Depreciation refers to the reduction in the monetary value of a fixed asset due to its…

Q: Compute depreciation under: (i) straight line method (ii) unit of output (iii) working hours…

A: Depreciation  under straight line method = (Cost of Asset - Salvage value / useful life )…

Q: On January 2, 2015, Roth, Inc. purchased a laser cutting machine to be used in the fabrication of a…

A: Depreciation expense: Depreciation expense is a non-cash expense, which is recorded on the income…

Q: JPHEI Company purchased a machine on January 1, 2016 for P6,000,000. At the date of acquisition, the…

A: Solution: Accumulated depreciation for 3 years (from 2016 to 2018) = (Cost - residual value) * 3/ 6…

Q: SABM Co. acquired a machine on January 1, 2018, at a cost of P120,000. It was expected to have a…

A: Depreciation expense is related to the drop in the value of an asset periodically because of the…

Q: Binson Company has provided information on intangible assets as follows: A patent was purchased…

A: Binson company Intangible section of Balance sheet As on December 31, 2019   Patent, net…

Q: A. Muharraq Industrial Co. purchased a Tradename for $ 240,000 on July 1, 2021. The Trademname is…

A: "Since you have asked multiple questions, we will solve first question for you. If you want any…

Q: Explain briefly what you understand by the term “depreciation” as used by accountants. In what…

A:

Q: On January 1, 2020, Techno Company sold a machine for RO15,000 cash. The Machine originally cost RO…

A: Solution:- Preparation of Journal entry as follows under:-

Q: Nikhil Limited purchased a machine on 1st July, 2019 for 8, 90,000 and freight and transit insurance…

A: Cost of the asset includes the purchase cost and all directly attributable costs.Cost of the machine…

Q: 3. On August 31, 2019, CAMELLIA Company purchased a new machinery for ₱540,000. The machinery has an…

A: On August 31, 2019, CAMELLIA Company purchased a new machinery for ₱540,000. The machinery has an…

Q: A machine was bought on 3rd October 2015 for $20,000. It was sold for cash for $10,000 on 2nd…

A: Depreciation expense is charged against the cost of long-term physical assets. It is a method of…

Q: USK COMPANY purchased a wood cutter on September 1, 2019 for P652,000. At the time of acquisition,…

A: solution: given: purchase price (cost )     =P652,000 useful life           =14 years residual value…

Q: On January 2, 2022, Lauren Corporation purchased factory equipment for $850,000. In addition, it…

A: Depreciation is considered as an expense charge on the value of the Asset. It can be calculated by…

Q: Z Limited purchases an asset for $50,000 from CashCrow Company on 1 January 2015 for cash. Z Ltd…

A: Total cost of the machine = Purchase price + Delivery and installation costs = $50,000 +$60000 =…

Q: A machine was bought on 3rd October 2015 for $20,000. It was sold for cash for $10,000 on 2nd…

A: Depreciation expense is charged against the cost of long-term physical assets. It is a method of…

Q: Lucky Lure Co. purchased a machine on October 1, 2018 for $125,000. It has a $15,000 residual value…

A: The question is based on the concept of Depreciation Accounting.Depreciation is the decrease in the…

Q: Barb Company has provided information on intangible assets as follows:1. A patent was purchased from…

A: The question is related to Measurement and Valuation of Intangible Assets to be shown in the Asset…

Q: The company estimates that the useful life of the machine is 4 years with a Tk. 5,000 salvage value…

A: The calculation of amount of annual depreciation is shown hereunder : Cash price of machine Tk…

Q: On January 2, 2016, King Pet purchased fixtures for $38,100 cash, expecting the fixtures to remain…

A: Depreciation is the loss in the value of the asset caused due to its usage, wear and tear.There are…

Q: On September 30​, 2017​, Foley Distribution Service purchased a copy machine for $36,800. Foley…

A: Please see the next step for the solution

Q: XYZ Company, a calendar year business, purchased machinery on February 2, 2016. The purchase price…

A: Lets understand the basis. As per IAS 16 "Property plant and equipment" initially needs to record at…

Q: Reliance Limited writes off depreciation on Plant and Machinery at 10% per annum on the reducing…

A: Depreciation: Depreciation is an accounting technique to distribute the cost of an asset over the…

Q: (a) Straight-line depreciation for 2022 (b) (c) (d) Activity method for 2023, assuming that machine…

A: When different depreciation methods are used, the depreciated amount for each year will differ. Some…

Q: Mwakisha, a contractor, started business on 1 January 2018.       Purchases and disposals of…

A: Depreciation In account term depreciation means it ascertain the net value of the assets which are…

Q: On March 1, 2019, Extreme Company exchanged an old machine having a cost of and accumulated…

A: The non cash assets acquired in exchange process is recorded at fair market value in the accounting…

Q: Waterway Company purchased a computer system for $86,700 on January 1, 2019. It was depreciated…

A: Depreciation refers to the gradual decrease in the value of an asset over time due to various…

Q: Popeye Company purchased a machine for $350,000 on January 1, 2020. Popeye depreciates machines of…

A: Decrease in the value of fixed assets are called depreciation, calculation of depreciation under…

Capital Gain

Any capital asset when sold can give the seller a higher or lower price from its purchase price leading to a capital gain or capital loss. The time period of holding an asset is decided based on if it is a long term or short-term capital gain. On that basis, the rate of taxation is decided if it is 20%, 15% or according to the tax brackets. The rate of taxation differs in the case of equity or debt, whether long or short term. The capital gain can be adjusted from capital loss to arrive at a net capital gain. The amount of gains and the exemption has to be reported in the tax return filed in the financial year in which the asset was transferred. The tax return can be filed quarterly, monthly, semi-annually or annually.