On 1st January 2017, Sincomed Company purchased three machines from the Chemical Machineries Ltd. under instalment payment

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On 1st January 2017, Sincomed Company purchased three machines from the Chemical Machineries Ltd. under instalment payment system. The cash down price of each machine was ₹8,865. The total amount was paid in four equal instalments of ₹7,500 on 31st Decmber every year. The Chemical Machineries Ltd. charged interest at 5% per annum. Charge depreciation at 10% per annum on the diminishing balances. Show the Machine Account, Chemical Machineris Ltd. Account and Interest Suspense Account in the books of the purchasing company.

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Financial Accounting Volume II

ISBN: 9789387886230

4th Edition

Authors: Mohamed Hanif, Amitabha Mukherjee

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