Depreciation

Learning Outcomes
to execute depreciation entries on tally.
Determine the amount of depreciation on an asset from the
following information: Cost Price- Rs. 80,000, Installation
Charges- Rs. 20,000, rate of depreciation @10% using
SLM. Purchase date- 1st April 2011 , date of Sale- 1st July
2011.
a) 10,000
b) 1,500
c) 2,500
d) 3,500
 Question 1
• On 1st April 2019 Capital introduced Rs.
50,00,000
• On 1st April 2019 W ltd purchased a second
hand Machinery for Rs. 5,00,000 and paid Rs.
50,000 on its repairs. Depreciation is to be
provided @10% p.a. using SLM. The machine
was sold for Rs. 4,50,000 on 31st March 2020.
Pass the necessary journal entries under correct
vouchers in tally.
 Question 2
• On 1st April 2017 Capital introduced Rs.
50,00,000
• On 1st July 2017 Zltd purchased a second hand
Machinery for Rs. 4,00,000 and paid Rs.
1,00,000 on its repairs. Depreciation is to be
provided @10% p.a. using WDV. The machine
was sold for Rs. 4,20,000 on 1st October 2018.
Pass the necessary journal entries under correct
vouchers in tally.
 Question 3
Record the necessary journal
entries in tally
Date Particulars
1-4-2017 Started business with cash Rs. 40,00,000
1-4-2017 Deposited Rs. 3,00,000 into HDFC bank
1-5-2017 Purchased Machinery for Rs. 1,00,000
1-5-2017 Paid Wages Rs. 5,000
1-6-2017 Rent outstanding Rs. 10,000
1-7-2017 Commission received through bank Rs. 40,000
1-1-2018 Sold machinery for Rs. 90,000
Depreciation is charged @10% using SLM.
 Question 4
• On 1st April 2011 Introduced capital Rs. 70,00,000
• On 1st September 2011 deposited Rs. 40,00,000 into bank
• On 1st January 2012. Divyam Ltd. Purchased a Machinery for Rs.
80,000 and spent Rs. 20,000 towards its repairs and installation.
The residual value at the end of its expected life of 4 years is
estimated at Rs.40,000. On 30th September 2013, this machinery is
sold for Rs.50,000. Depreciation is charged according to Straight
Line Method.

Pass the necessary journal entries under correct vouchers in tally

 Create a company on your Registration number which is situated in
Maharashtra and starting its business on 1-4-2017. Write down the name
of company, password of company and number of your company.

1-4-2017 Introduced capital in the business Rs. 50,00,000

1-4-2017 Amount deposited in Punjab National Bank A/c Rs. 30,00,000
1-5-2017 Purchased Chairs for Rs13,000
1-4-2017 Machinery I purchased through Cheque for Rs. 1,00,000
1-11-2017 Machinery II purchased through Cash for Rs. 80,000
1-07-2018 Machinery I sold for Rs. 65,000
31-3-2019 Outstanding Wages Rs.50,000
  Show the Amount of depreciation charged on Machinery 1 ,
Machinery 2 and on chairs for both the years
(Depreciation to be charged 12% p.a on Straight line method )
Show the outcome of above transactions in the form of Balance Sheet and
Profit & Loss A/c for both the years 2017-18 & 2018-19.