E T B Best PGDM Institute in Delhi PGDM Course in Delhi MBA AGU Best PGDM College in Delhi NCR Best MBA Colleges in Bangalore

Fixed Asset Disposal Account

A company writes off depreciation on straight line basis on machinery at 10 %. On 31st march 2004 the position was as under:
Cost of purchase to date Rs 52,590
Depreciation written off to date Rs 25,670
During 2004-05 an addition of Rs 2480 was made to machinery a machine bought in 2000-01 for rs 2800 was sold for Rs800 during the year
You are required to show the machinery account and depreciation account for the year 2004-05 (show your workings fully).

asked Feb 26, 2016 in Depreciation, Provisions and Reserves. by kenamotiwala (37 points) 264 views

1 Answer

0 votes


1.  Depreciation on machine sold in 2004-2005.

Depreciation @10% on straight line method from 2000-2001 to 2003-2004 =

 (Rs.2800 x 10% = 280 x 4) = Rs.1120

2. As dates of purchase and sale of machines is not given, depreciation on all machines is charged for the full year in the year of purchase and no depreciation is charged in the year of sale.

3. Depreciation charged during 2004-2005.

Cost of machinery available in 2004-2005 (52590+2480-2800) = Rs.52270

Depreciation @ 10% on Rs.52270 = Rs.5227

answered Feb 27, 2016 by jbsclasses (3,969 points)