Question : Apple Ltd. has Machinery written down value of which On 1st April 2019 was Rs 6,60,000 and on 31st March 2020 was Rs 7,50,000. Depreciation for the year was Rs 40,000. At the beginning of the year, an item of machinery was sold for Rs 25,000 which had a written-down value of Rs 20,000
Question:
Calculate gain/loss on the sale of machinery.
Option 1: Rs 5,000 profit
Option 2: Rs 5,000 loss
Option 3: Rs 3,000 profit
Option 4: None of the above
Answer (1)
17th Jan, 2024
Correct Answer: Rs 5,000 profit
Solution : Answer = Rs 5000 profit
| Machinery a/c | |||
| To Bal b/d | 6,60,000 | By depreciation | 40,000 |
| To Profit & loss a/c(profit) | 5,000 | By Bank(sale) | 25,000 |
| To Bank (Purchases) | 1,50,000 | By Balc/d | 7,50,000 |
| 8,15,000 | 8,15,000 | ||
Hence, the correct option is 1.
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