urgent

books of ram shows on 1st jan 2006, furniture rs.20000/- during the year the part of furniturewhose book value on 1st jan 2006 is rs. 1200/-has been exchanged with another furniture by paying additional rs.500/-. Ram charged depreciation @ 10% p.a, the net amt of the furniture to be shown in the Bal. Sheet.?

Plz give ans

thanx

urgent

Replies (2)

 THe value of new furniture as per AS 10

WDV of old furniture given + Cash paid i.e; rs. 1700.

 

WDV as on beginning of the year                    Rs. 20,000

Less: - Furniture Given up                                         (1200)

                                                                                       18,800

+ Value of New Furniture                                              1700

                                                                                         20,500

Depreciation @ 10%                                                    (2050)

balance to be shown in B/S                                       18,450

Note: - It has been assumed that depreciation is charged on closing balance.

Alternatively 

WDV as on beginning of the year                    Rs. 20,000

+ Incease in the value of furniture due

to exchange transaction                                                                   500

                                                                                                         20500

Depreciation @ 10%                                               (2050)

balance to be shown in B/S                                   18,450

Note: - It has been assumed that depreciation is charged on closing balance.

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