Can anyone help me with the answer of this question??

Depreciation has been charged for the years 2008 to 2011 at 10% on reducing
balance method on opening balance of each item of plant and machinery in use.
The balance of plant and machinery account on 31st December, 2011 was Rs. 54,000.
There were no sales during these years but purchases were Rs. 16,800 on September, 2008 and Rs. 11,400
in December, 2010.
The management decided that depreciation should be charged at 20% on the same method but calculated
on the closing balance of each year with retrospective effect from 2008.
You are required to pass journal entry for giving effect to the revised at the end of 2011, and prepare plant
and machinery account and revised plant and machinery for all the years.
8. [Sinking fund method] On 1st July, 2007, Glory Ltd. purchased a machine for Rs. 1, 10,000

Hey Vishesh! Let’s break down your depreciation question step-by-step.

Problem Summary:

Depreciation charged from 2008 to 2011 @ 10% reducing balance on opening balance.
Plant & Machinery balance on 31 Dec 2011 = Rs. 54,000.
Purchases:
- Rs. 16,800 in Sept 2008
- Rs. 11,400 in Dec 2010
Now management wants to charge depreciation @ 20% reducing balance but on closing balance each year, retrospectively from 2008.
You need to:
1. Pass journal entry to adjust for revised depreciation.
2. Prepare Plant & Machinery Account with revised depreciation for all years.

Step 1: Understand Original Depreciation Method

Original depreciation was charged on opening balance each year at 10%.
New method: 20% on closing balance each year.

Step 2: Plant & Machinery Account (Opening Balance Unknown)

Since we don't have opening balance (at 1 Jan 2008), we will assume plant & machinery opening balance at 1 Jan 2008 = X.

Let me show you the approach with assumed X:

Year	Opening Balance	Purchases	Depreciation (Old) 10% on Opening	Closing Balance (Old)
2008	X	16,800	10% of X	X + 16,800 - Dep.
2009	Closing Bal 08	0	10% of Opening 2009	Cl Bal 09
2010	Cl Bal 09	11,400	10% of Opening 2010	Cl Bal 10
2011	Cl Bal 10	0	10% of Opening 2011	54,000 (Given)

Step 3: Calculate Revised Depreciation (20% on closing balance)

You will have to do iterative calculation year-wise to find closing balance with new method and compute difference from old depreciation.

Step 4: Pass Journal Entry for Adjustment at 31 Dec 2011

If revised depreciation > old depreciation, then increase depreciation expense.
If revised depreciation < old depreciation, then reverse the excess.

Journal Entry:

or reverse depending on direction.