From the following information, determine amount of machinery purchased, to be shown as outflow in Investing Activities.
| 31 March 23 | 31 March 22 | |
| Machinery (Cost) | 12,50,000 | 10,00,000 |
| Accumulated Depreciation | 2,10,000 | 1,80,000 |
Additional Information:
During the year 2022-23, a part of Machinery Costing ₹2,00,000 (Book value 1,60,000) was sold at a loss of ₹25,000.
Answer & explanation
Correct answer: option 1
The correct answer is Option 1 - ₹4,50,000.
Machinery Account
|
Particulars |
J.F. |
Amount(₹) |
Particulars |
J.F. |
Amount(₹) |
|
To Balance b/d |
|
10,00,000 |
By Cash |
|
1,35,000 |
|
By Accumulated Depreciation |
40,000 |
||||
|
By Statement of Profit and Loss |
25,000 |
||||
|
To Cash |
4,50,000 |
By Balance c/d |
12,50,000 |
||
|
|
14,50,000 |
|
14,50,000 |
Machinery cost which is sold = 2,00,000
Less: Accumulate depreciation on this = 40,000
Book value = (2,00,000 - 40,000)
= ₹1,60,000
Loss at which it is sold = 25,000
Sale value = 1,60,000 - 25,000
= ₹1,35,000
Accumulated Depreciation Account
|
Particulars |
J.F. |
Amount (₹) |
Particulars |
J.F. |
Amount (₹) |
|
To Machinery |
|
40,000 |
By Balance b/d |
|
1,80,000 |
|
To Balance c/d |
2,10,000 |
By Statement of Profit and Loss |
70,000 |
||
|
|
2,50,000 |
|
2,50,000 |