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On 1st July, 2015, A Co. Ltd. purchases second-hand machinery for ₹ 20,000 and spends ₹ 3,000 on reconditioning and installing it. On 1st January, 2016, the firm purchases new machinery worth ₹ 12,000. On 30th June, 2017, the machinery purchased on 1st January, 2016, was sold for ₹ 8,000 and on 1st July, 2017, a fresh plant was installed. Payment for this plant was to be made as follows: 1st July, 2017 – ₹ 5,000 30th June, 2018 – ₹ 6,000 30th June, 2019 – ₹ 5,500 Payments in 2018 and 2019 include interest of ₹ 1,000 and ₹ 500 respectively. The company writes off 10% p.a. on the original cost. The accounts are closed every year on 31st March. Show the Machinery Account for the year ended 31st March, 2018. |
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