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Shantikunj Company, Rajoli purchased furniture worth Rs.  38,400 and paid Rs. 1,600 for installation charges on 1stJanuary, 2004.                                        (10)
On 31st March every year, the company charged depreciation @ 10% p.a. on original cost.
On 1stOct.2004 the company purchased an additional furniture costing Rs. 24,000.
The company sold furniture for Rs.  31,500 on 31stDecember 2005, which was purchased on 1st January 2004.
Company purchased a new furniture worth Rs.  20,000 on 31st March, 2006.
You are required to prepare Furniture account and depreciation account for the years 2003-2004, 2004-2005 and 2005-2006.
In the books of Shantikunj Company
 Date Particulars JF Amt Rs. Date Particulars JF Amt Rs. 1-1-04 To Cash / Bank A/c By Depreciation A/cBy Balance c/d 1,00039,000 40,000 31-3-0431-3-04 40,000 40,000 1-4-041-10-04 To balance b/dTo Cash / Bank A/c 39,00024,000 31-3-0531-3-05 By Depreciation A/c (4000 + 1200)By Balance c/d 5,20057,800 63,000 63,000 1-4-0531-3-06 To balance b/dTo Cash / Bank 57,80020,000 31-12-0531-12-0531-12-0531-3-0631-3-06 By Cash / Bank A/cBy Profit & Loss A/cBy Depreciation A/cBy Depreciation A/cBy Balance c/d 31,5005003,0002,40040,400 77,800 77,800 1-4-06 To balance b/d 40,400 40,400 40,400
Depreciation A/c.
 Date Particulars JF Amt Rs. Date Particulars JF Amt Rs. 31-3-04 To Furniture A/c 1,000 31-3-04 By Profit & Loss A/c 1,000 1,000 1,000 31-3-05 To Furniture A/c 5,200 31-3-05 By Profit & Loss A/c 5,200 5,200 5,200 31-12-05 To Furniture A/cTo Furniture A/c 3,0002,400 31-3-06 By Profit & Loss A/c 5,400 5,400 5,400
Working Note  :-
To find Profit or loss on sale of Furniture
Original cost as on 1-1-04                    40,000
(-) Depreciation           (3 months)           1,000
Book value as on 1-1-04                        39,000
(-) 10% Dep.  (2004 – 05)                          4,000
Book Value as on 1-4-05                        35,000
(-) Depreciation (9 months)                     3,000
Book value as on 31-12-05                   32,000
Less: Selling Price                                 31,500
Loss on Sale                                               500