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Accounting entry,


Gireesh.kallerikkarammal (Accountant)     27 March 2014

Gireesh.kallerikkarammal
Accountant 
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I want know the accounting entry for below mentioned transcation.

machinery purchased RS.10000 in 2011, depreciation charged on 2012 RS 1000, and machinery sold in 2013 for rs 11000. what are the entry to be passed

avater

JAINENDRA JAIN (ACS/CA)     27 March 2014

JAINENDRA JAIN
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cash/bank a/c dr 11000

   to machinery a/c    9000

to profit on sale of machinery  2000

1 Like
avater

Kunal Pansari (Accountant)     31 March 2014

Kunal Pansari
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Mr. Jainendra Jain, your answers does not reflect any entry of depreciation. So in my opinion the entry would go like below:

 

While Purchase of Machinery

Machinery A/c Dr. Rs. 10000

Cash/Bank A/c Cr. Rs. 10000

 

Depreciation of Machinery

Depreciation A/c Dr. Rs. 1000

Machinery A/c Dr. 1000

 

Sell of Machinery

At the time of selling, the closing value of machine is Rs. 10000 (11000-1000) So the entry would be as:

Cash/Bank A/c Dr. 11000 (The amount at which the machine was sold)

Machinery A/c Cr. 10000

Profit & Loss A/c Cr. 1000

 

Originally posted by : JAINENDRA JAIN

cash/bank a/c dr 11000

   to machinery a/c    9000

to profit on sale of machinery  2000

 

avater

JAINENDRA JAIN (ACS/CA)     31 March 2014

JAINENDRA JAIN
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IN REPLY TO KUNAL PANSARI.

THE QUESTION DEMANDED ENTRY FOR SALE OF MACHINERY.

SO I REPLIED IN THAT WAY.

HOWEVER U ARE ALSO CORRECT.

avater

Danish (GST Practitioner)     31 March 2014

Danish
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Dear Gireesh,

Simply,

Purchase Of Machinery:

Machinery A/c        Dr 10000

 To Cash/Bank A/c  Cr 10000

--------------------------------------------

Depreciation A/c           Dr 1000

    To Machinery A/c      Cr 1000 [Here I Request Kunal To check]

------------------------------------------------------------------------------

Depreciation A/c       Dr   1000   [Considering 1000 As Depreciation For 2013]

   To Machinery A/c   Cr   1000

----------------------------------------------------------------------------------------------------------------

Bank/Cash A/c       Dr 11000

 To Machinery A/c   Cr           8000[Book Balance Of Machine Must Be Zero After This Entry As                                       Depreciation Charged On 2012 & 2013]   

 To P&L A/c            Cr           3000

 

 

1.The value of Machinery In Your Books Should Be 8000 Before sale (as 1000 depreciation was already charged & 1000 Considered As depreciation for 2013)

 

avater

Kunal Pansari (Accountant)     31 March 2014

Kunal Pansari
Accountant 
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Dear Danish, in your reply I would like to say that first of all we need to know the date of selling of machinery because in case if machine was sold on April 2013, we cannot deprecitate the machinery for the whole financial year 2013-2014 and also it is said that machine was purchased on 2011 but no month was mentioned.

Originally posted by : Danish

Dear Gireesh,

Simply,

Purchase Of Machinery:

Machinery A/c        Dr 10000

 To Cash/Bank A/c  Cr 10000

--------------------------------------------

Depreciation A/c           Dr 1000

    To Machinery A/c      Cr 1000 [Here I Request Kunal To check]

------------------------------------------------------------------------------

Depreciation A/c       Dr   1000   [Considering 1000 As Depreciation For 2013]

   To Machinery A/c   Cr   1000

----------------------------------------------------------------------------------------------------------------

Bank/Cash A/c       Dr 11000

 To Machinery A/c   Cr           8000[Book Balance Of Machine Must Be Zero After This Entry As                                       Depreciation Charged On 2012 & 2013]   

 To P&L A/c            Cr           3000

 

 

1.The value of Machinery In Your Books Should Be 8000 Before sale (as 1000 depreciation was already charged & 1000 Considered As depreciation for 2013)

 

 

avater

Danish (GST Practitioner)     31 March 2014

Danish
GST Practitioner 
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Originally posted by : Kunal Pansari




Dear Danish, in your reply I would like to say that first of all we need to know the date of selling of machinery because in case if machine was sold on April 2013, we cannot deprecitate the machinery for the whole financial year 2013-2014

Originally posted by : Danish




Dear Gireesh,

Simply,

Purchase Of Machinery:

Machinery A/c        Dr 10000

 To Cash/Bank A/c  Cr 10000

--------------------------------------------

Depreciation A/c           Dr 1000

    To Machinery A/c      Cr 1000 [Here I Request Kunal To check]

------------------------------------------------------------------------------

Depreciation A/c       Dr   1000   [Considering 1000 As Depreciation For 2013]

   To Machinery A/c   Cr   1000

----------------------------------------------------------------------------------------------------------------

Bank/Cash A/c       Dr 11000

 To Machinery A/c   Cr           8000[Book Balance Of Machine Must Be Zero After This Entry As                                       Depreciation Charged On 2012 & 2013]   

 To P&L A/c            Cr           3000

 

 

1.The value of Machinery In Your Books Should Be 8000 Before sale (as 1000 depreciation was already charged & 1000 Considered As depreciation for 2013)

 





 
 

Thankyou Kunal For Quote 

 

I Had it In Mind That The Date Is Matters Thats Why I clearly Mentioned "Considering"

Gireesh' you Should Have to Charge Depreciation On Machinery Other Than If It Sold on 1st Of April -13 

avater

Kunal Pansari (Accountant)     31 March 2014

Kunal Pansari
Accountant 
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Danish, what is the rate of depreciation for Furnitre in an annum?

If I am not wrong, it is 15%

Originally posted by : Danish




Originally posted by : Kunal Pansari







Dear Danish, in your reply I would like to say that first of all we need to know the date of selling of machinery because in case if machine was sold on April 2013, we cannot deprecitate the machinery for the whole financial year 2013-2014

Originally posted by : Danish




Dear Gireesh,

Simply,

Purchase Of Machinery:

Machinery A/c        Dr 10000

 To Cash/Bank A/c  Cr 10000

--------------------------------------------

Depreciation A/c           Dr 1000

    To Machinery A/c      Cr 1000 [Here I Request Kunal To check]

------------------------------------------------------------------------------

Depreciation A/c       Dr   1000   [Considering 1000 As Depreciation For 2013]

   To Machinery A/c   Cr   1000

----------------------------------------------------------------------------------------------------------------

Bank/Cash A/c       Dr 11000

 To Machinery A/c   Cr           8000[Book Balance Of Machine Must Be Zero After This Entry As                                       Depreciation Charged On 2012 & 2013]   

 To P&L A/c            Cr           3000

 

 

1.The value of Machinery In Your Books Should Be 8000 Before sale (as 1000 depreciation was already charged & 1000 Considered As depreciation for 2013)

 





 
 




Thankyou Kunal For Quote 

 

I Had it In Mind That The Date Is Matters Thats Why I clearly Mentioned "Considering"

Gireesh' you Should Have to Charge Depreciation On Machinery Other Than If It Sold on 1st Of April -13 

 

avater

Danish (GST Practitioner)     31 March 2014

Danish
GST Practitioner 
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RATES OF DEPRECIATION AS PER COMPANIES ACT, 1956
SCHEDULE XIV 

 

FURNITURE AND FITTINGS

W.D.V    %

S L M %
1. General rates (NESD) 18.1 6.33
2.Rate for furniture and fittings used in hotels, restaurants and boarding houses, schools, colleges and other educational institutions, libraries, welfare centres, meeting halls, cinema houses, theatres and circus, and for furniture and fittings let out on hire for use on the occasion of marriages and similar functions (NESD) 25.88 9.5

 

As per IT 10 % 


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