Machinery purchased on 1/04/2014 for Rs.200000 depreciation@10% (SLM)
Machinery sold for Rs. 180000 on 30/04/2016
What is Profit on sale of Fixed Assets?
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Step 1
| Particular |
2014 - 15 SLM Basis |
2015 - 16 | 2016 - 17 |
|
Opening value
|
200000
|
180000
|
110000
|
|
less Dep 10% |
20000 |
20000 |
1667 (200000*10/100*1/12) |
|
Closing Value
|
180000
|
160000
|
158333
|
Cost Price = 158333
Sales Price = 180000
Profit on Sale of Asset = 180000 - 158333 = 21667
Pass Entries for Depreciation
Entry for depreciation 1st year(1/04/2014 to 31/3/2015)
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3/31/2015
Depreciation A/c Dr 20000
To Accumulated Depreciation 20000
Entries For Depreciation for 2nd year (1/04/2015 to 30/04/2016)
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3/31/2015
Depreciation A/c Dr 20000
To Accumulated Depreciation 20000
Entries For Depreciation for one month (1/04/2015 to 30/04/2016)
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3/31/2016
Depreciation A/c Dr 1667
To Accumulated Depreciation 1667
Entries For Sale of Fixed asses accumulated method
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3/31/2016
Bank a/c Dr 180000
Accumulated Depreciation A/c Dr 41667
To Machine A/c 200000
To Profit on sale of fixed assets 21667