Question: Dr. Kapil Seths Imaging Centre Ltd. part exchanged its old X-ray machine with a new one from Rajneesh Medical Equipments Ltd. Net book value of

Dr. Kapil Seth’s Imaging Centre Ltd. part exchanged its old X-ray machine with a new one from Rajneesh Medical Equipments Ltd.
Net book value of the old X-ray machine was ₹4,68,345. However the vendor assessed its exchange value at ₹4,25,000 to which Dr. Kapil Seth’s Imaging Centre Ltd. agreed. The selling price of the new X-ray machine as per the company price list was ₹12,58,000 subject to a further discount of ₹12,580 in case of an outright sale deal. The discount was, however, not available for exchange case and, therefore, Dr. Kapil Seth’s Imaging Centre Ltd. paid ₹8,33,000 by way of cheque drawn on its Corporation Bank current account to Rajneesh Medical Equipments Ltd.

Determine the cost at which the new X-ray machine will be recorded in the financial statements of Dr. Kapil Seth’s Imaging Centre Ltd. How will the old X-ray machine be treated?

Step by Step Solution

★★★★★

3.50 Rating (163 Votes )

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock

Answer To determine the cost at which the new Xray machine will be recorded in the financial ... View full answer

Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock

Step: 3 Unlock

Students Have Also Explored These Related Principles Financial Accounting Questions!

Which form of business organization is limited by the Internal Revenue Code (IC) concerning the number and type of shareholders? A partnership An S corporation A C corporation A sole proprietorship...

7) The second financial statement to prepare is the statement of retained eamings. To determine the ending balance of retained earnings you need to start with the opening balance as reported in the...

Madayag Development Corporation (MDC) is a real estate development company that is 60% owned by Thomas Madayag. Seatons Inc., a privately owned Canadian department store chain, owns 30%, and 10% is...

There is a case question (very last question) in the document below and i would like to know how to resolve it properly University of Toronto Faculty of Arts and Science and Rotman School of...

prepare a full case report analyzing the issues and making appropriate recommendations.Assume you are a consultant advisingDr. Frank Davis, one of CMIs radiologists partners. Write your group report,...

Please see the attached case study. Get into groups of max. 6 people and prepare your presentation slides to cover the following headings. Make sure to time yourself, max. 1 0 to 1 2 min. per group....

LA PAZ COMMUNITY HOSPITAL The Lapaz Community Hospital (LCH) Limited was incorporated in September 2003 under the companies Act 1963 (Act 179) as a private clinic and it commenced health service...

You have been asked to check the valuation of InfoSys, a software firm, done by an eminent analyst. You note that the analyst has assumed earnings growth of 10% a year for the next 3 years, and 5% a...

A single-phase full-wave bridge rectifier has a resistive load of 18 ohms and an ac source of 120 V rms. Determine the average, peak, and rms currents in the load and in each diode.

ACC 6 2 0 Module Six Presentation Guidelines and Rubric Scenario You are a new senior accountant at Shaggy s Surfboards in Pismo Beach, California. Shaggy s Surfboards is less than five years old as...

Factory overheads include all of the following except (a) salary of plant manager (b) depreciation on delivery department (c) small tool expenses (d) taxes on factory building Ans: (b)

Hexaware Technologies Limited is a leading software services provider, specializing in Application Management, EAI, e-Commerce, ERP and Embedded Systems. Industries served by the company include...

State whether the following statement are True or False: Revenue should be recognized after deducting the service taxes, value added taxes and goods and service taxes, (Ind-AS 18).

COCHIN International Airport Ltd (CIAL), the promoter and operator of the Cochin international airport in the country, located near Nedumbassery, is to allot shares worth 35 crore to its 10,000...

Problom applicable to 20Y5 : applicabie to 20Y5 : A. Land esting sis 000 was ald for $15000 fanstructions operating activities. ( 2$70,670=$74,670$4,000 (increase in dividends) Problem The income...

Journalize the following transactions using the allowance method of accounting for uncollectible receivables. Apr. 1 Sold merchandise on account to Jim Dobbs, $8,220. The cost of the merchandise is...

Welch issues bonds dated January 1, 2011, with a par value of $250,000. The bonds annual contract rate is 9%, and interest is paid semiannually on June 30 and December 31. The bonds mature in three...