IPCC Nov 11 Accounting paper doubt

This is what I could solve from this question. I dont know if its correct or not.

1Loss of Exchange of Machine

First calculate the book value of machine disposed

Rs 160000-5%(dep for 6 months) = 152000

Loss on exchange- 152000-135000 = 17000

2. Book Value of machine on 31-03-2011

first deduct value of new machine from 560000 i.e. 150000 = 410000

now depreciation on 150000 @ 5% = 7500

and on 410000 @ 10 % = 41000

so deduct the depreciation = 560000-7500-41000 = 511500

3. Total Depreciation

41000+7500+8000 = 56500

i totally agree with u ashish gupta..

i think my answer is write because i m solved as it is as explain above

Yes you are right Sneha, my mistake. But there appears no other way to solve this problem with SLM as the date of purchase of machinery is not given.

Fine, let us wait and see till ICAI releases suggested answers..

Thank you..

hi sneha my self indrajeet from rajkot doing ca ipcc. the answer should be as follows.....

1)Total dep.to be charged in p&l a/c.

     on bala.1/4/10   suppose 100

     dep @ 10%                          (10)

      bala.on 31/03/11                90

 now...origenal cost on 1/4/10  56000/90*100=622222

            dep on or.cost=560000/90*10=62222

Now dep.on exchanged machine is =160000*10%*6/12=8000

Total dep.to be charged =62222+8000=70222            

answer (2) and (3) i will give you in next post                                 

hi sneha the answer of (2) &  (3) as followes

(2) Loss on Excange

      origenal cost on 1/4/10      160000

     -dep (160000*10%*6/12)  (8000)

           WDV on 30/09/10         152000

Loss  

WDV on 30/09/10         152000

-Desposel @                  (135000)

                 Loss=           17000

Ans (3)  Book Value of M/C on 31/03/2011 In Balance Sheet  as follows

subtrect value of new m/c from old m/c Value i..e. 560000-150000=410000 on 30/09/2010

dep.for full year  on 410000*10%=41000

WDV  410000-41000=369000 OLD M/C

WDV of  new m/c 150000- dep (150000*10%*6/12)=142500

Total BOOK Value To Be Shown In Bal.Sheet is 369000+142500=511200

in this we have followed straight line method...

there will be appleid SLM method

Dear Friend

i send today or tmorrow.

Dear Friends

I Solving  IPCC Accounting & Advanced Accounting , Cost &FM& Taxation Paper.

PCC Accounting Paper Solving.

can anyone pls put up the solution to the entire question paper plss..

Hi Sneha. Myself Tony John.

I beg to differ fom the way both Ashish and Indrajeet have solved the problem.

We are given the closing balance of the machine in the TB. This means that depreciation hasn't been provided on it. Usually asset balances in TB are before providing dep. So i don't think we have to mulyiply 560000 with 100/90 to find its opening WDV.

In my opinion this is the way the problem has to be approached. It may or may not be correct.

Calculation of depreciation

1.  Depreciation on sold machine (160000*5%) = 8000

2. Depreciation on new machine (150000* 5 %)= 7500

3. Depreciation on remaining block

Opening WDV ( on 01 Apr 2010) = 560000+160000-150000

                                             = 570000

So depn remaining block=

(570000 - 160000-150000)* 10%= 26000

Hence total dep = 8000+7500+26000 = 41500.

Book Value in B/S = 560000-41500 = 518500

Loss on sale is same as has been worked out earlier,Rs.17000

Hi Sneha. Myself Tony John.

I beg to differ fom the way both Ashish and Indrajeet have solved the problem.

We are given the closing balance of the machine in the TB. This means that depreciation hasn't been provided on it. Usually asset balances in TB are before providing dep. So i don't think we have to mulyiply 560000 with 100/90 to find its opening WDV.

In my opinion this is the way the problem has to be approached. It may or may not be correct.

Calculation of depreciation

1.  Depreciation on sold machine (160000*5%) = 8000

2. Depreciation on new machine (150000* 5 %)= 7500

3. Depreciation on remaining block

Opening WDV ( on 01 Apr 2010) = 560000+160000-150000

                                             = 570000

So depn remaining block=

(570000 - 160000-150000)* 10%= 26000

Hence total dep = 8000+7500+26000 = 41500.

Book Value in B/S = 560000-41500 = 518500

Loss on sale is same as has been worked out earlier,Rs.17000