M/s. Caps Lock purchased a new machine on 1st Jan 2017 for Rs.3,20,000 and also incurred Rs.80,000 on its installation. Another machine was purchased on 1st July 2017 for Rs.1,60,000. On 1st July 2019, the machinery purchased on 1st January 2017 was sold for Rs.2,50,000. Another machine was purchased and installed on 30th September 2019 for Rs.60,000. The company provides for depreciation @ 10% p.a on Original Cost till 2019. From the year 2020 it decided to adapt to WDV method and charge depreciation @ 15% p.a. You are required to show Machinery Account for the year 2019 & 2020 considering the books are closed on 31st December each year.

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A:

Q: On January 1, 2021, Piling Company has Land, Building and Machinery with brought forward balances…

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Q: Rayya Co. purchases and installs a machine on January 1, 2017, at a total cost of $134,400.…

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Q: On July 1, 2017, Sandhill Company received $1,012,000 cash as compensation for the forced sale…

A: Introduction: Journal: Recording of a business transactions in a chronological order. First step in…

Q: On January 1, 2017, Global Manufacturing purchased a machine for $540,000 that it expected to have a…

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A: NOTE : As per BARTLEBY guidelines, when multiple sub parts are given then first three sub parts are…

Q: On July 1, 2015, Ling Company purchased a building for P49,200,000. The building has an estimated…

A: Accumulated depreciation on December 31, 2019 = Cost of building  - book value of the building on…

Q: On July 1, 2022, BTS Company purchased a machinery from a dealer paying P2,310,000 cash. In…

A: Purchase cost = P2,310,000 Transportation cost = P150,000

Q: On January 2, 2015, Roth, Inc. purchased a laser cutting machine to be used in the fabrication of a…

A: Depreciation expense: Depreciation expense is a non-cash expense, which is recorded on the income…

Q: On June 15, 2015, Jupiter Corporation purchased a machine for $50,000 with an estimated useful life…

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A:

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A: 1. Following are the calculation of depreciation expense:

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Q: On August 1, 2018, Banco Company purchased a new machine on a deferred payment basis. A down payment…

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A:

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Q: The following information pertains to Nour Company: 1- Equipment was purchased on September 1, 2014…

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A:

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Q: On January 1, 2014, Raven Company acquired a building at cost of P5,000,000. The building has been…

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Q: On July 1, 2019, Mega Company purchased a machinery for P900,000 and incured freight and handling…

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A: Following is the answer to the given question

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Capital Gain

Any capital asset when sold can give the seller a higher or lower price from its purchase price leading to a capital gain or capital loss. The time period of holding an asset is decided based on if it is a long term or short-term capital gain. On that basis, the rate of taxation is decided if it is 20%, 15% or according to the tax brackets. The rate of taxation differs in the case of equity or debt, whether long or short term. The capital gain can be adjusted from capital loss to arrive at a net capital gain. The amount of gains and the exemption has to be reported in the tax return filed in the financial year in which the asset was transferred. The tax return can be filed quarterly, monthly, semi-annually or annually.