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Plant and machinery costing 50000 was purchased on 1 April 2006. This was depreciated for 2 yrs at 20% using the reducing balance method. On 1 April 2008, the machinery (original cast 25000) was sold for 12000. Replacement machines were acquired on same date for 34000.
What was the carrying value of plant and machinery at march 2009.
sir in this question I got the correct answer 40000. But I wanted to do by journal and ledger entry but I got lost in middle of solution 😀
I just want to see step by step journal and ledger entry if it is possible for this question
You can see the entries that need to be made on a disposal by watching our free lectures on depreciation (which also cover disposal).
However, I would not spend too much time on the entries – paper F3 has very little testing of actual debits and credits. If you get the right answer then this is all that matters. This would be asked in the MCQ section of the exam, and nobody looks at your workings – only the final answer is marked.
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