Please solve my query

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

08 January 2013 Manish Industry purchased a machinery worth Rs 50000 in 1st Jan 2004.They charged depriciation at 10% p.a on 31 Dec every year.On 1st OCT 2006 they sold the machinery at Rs 60000.Calculate the profit on sale of asset
Calculate Depriciation as per WDV and SLM

CA Priyank Singhi

CA Priyank Singhi (Expert)
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09 January 2013 Since you have sold the asset in the same year using SLM or WDV method will not make any difference. Charge dep for 9 months @ 10% viz 50000*10%*9/12 = 3750.
Dep A/c Dr 3750
To Asset A/c 3750

Now the value of your asset is 50000 - 3750 = 46250.
Profit on sale of machinery = 60000-46250 = 13750.

Bank A/c Dr. 60000
To Profit on sale of Machinery Dr. 13750
To Asset A/c 46250

Now trf Profit on sale to P/L

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