Depreciation - Part 3 - Asset A/c & Depreciation A/c | Class 11th Accounts | CA Pradeep Assiwal

Preparation of Asset Account & Depreciation Account 🎯 | Class 11 Accountancy (SLM & WDV Ledgers) Master the complete ledger preparation of Asset Account (Machinery Account) and Depreciation Account under both the Straight Line Method (SLM) and Written Down Value (WDV) Method! Learn standard journal entries, posting mechanics, pro-rata depreciation calculations, balancing at year-end, and tracking asset sales with profit or loss to score full marks in your Class 11 exams! Hey Class 11 Commerce Champions! 👋 Welcome back to our dedicated masterclass series on Chapter: Depreciation, Provisions, and Reserves. Now that you know the underlying concepts and calculation formulas of SLM and WDV, it is time to master the actual exam deliverable: Drafting the Ledgers! In Class 11 annual exams, questions on preparing a Machinery Account across 3 to 4 financial years carry a guaranteed 6 to 8 marks. In this comprehensive, practical session, we bridge the gap between calculation and double-entry ledger posting. You will learn the exact journal entries when depreciation is charged directly to the asset account, master the step-by-step posting into the Asset Account and Depreciation Account, handle mid-year purchases, calculate pro-rata depreciation, account for the sale of an asset (along with calculating profit or loss on sale), and balance your ledgers cleanly at the close of every financial year! What We Cover in This Practical Ledger Session: 📜 Section 1: Accounting Mechanism & Standard Journal Entries Understanding the Direct Method (Depreciation charged directly to Asset Account): When an asset is purchased: Asset A/c Dr. to Bank/Vendor A/c (including direct installation costs). When depreciation is charged at year-end: Depreciation A/c Dr. to Asset A/c. When depreciation is closed to P&L: Profit & Loss A/c Dr. to Depreciation A/c. When an asset is sold: Charging depreciation up to the date of sale: Depreciation A/c Dr. to Asset A/c. Recording sale proceeds: Bank A/c Dr. to Asset A/c. Transferring profit on sale: Asset A/c Dr. to Profit & Loss A/c. Transferring loss on sale: Profit & Loss A/c Dr. to Asset A/c. 🏗️ Section 2: Structure & Rules of the Asset Account (Machinery A/c) Debit side entries: Opening balances (To Balance b/d), fresh purchases (To Bank A/c), and gain on sale. Credit side entries: Depreciation (By Depreciation A/c), sale proceeds (By Bank A/c), loss on sale (By Profit & Loss A/c), and closing balance (By Balance c/d). The annual balancing routine: Bringing down balances (To Balance b/d) on the first day of the subsequent financial year. 📉 Section 3: Drafting the Depreciation Account Why the Depreciation Account has no closing balance (No Balance c/d)! The annual cycle: Debited by the corresponding asset name (To Machinery A/c) and immediately closed by transfer to the Profit & Loss Account (By Profit & Loss A/c). ⚡ Section 4: Live Practical Drills & Multi-Machine Tracking Solving full-length, 3-year comprehensive numerical problems under both Straight Line Method (SLM) and Written Down Value (WDV) Method. If this session made drafting the Machinery Account and Depreciation Account simple and error-free, please hit the 👍 Like button, Share this class with your commerce classmates, and Subscribe so you don't miss our next session on Preparation of Provision for Depreciation Account! 💬 Class Challenge: On 1st April 2023, Star Ltd. purchased a machine for ₹2,00,000. Depreciation is provided @ 10% p.a. on the Written Down Value (WDV) Method, with accounts closing on 31st March. On 1st October 2025, the machine was sold for ₹1,50,000. Calculate: (1) Depreciation for the year of sale up to 1st October 2025, and (2) Profit or Loss on the sale of the machine. Drop your answers in the comments below! 👇 #DepreciationAccounting #Class11Accounts #AssetAccount #MachineryAccount #DepreciationAccount #SLMMethod #WDVMethod #Class11Accountancy #AccountingLedgers #CommerceClass11 #CBSECommerce #TSGrewalSolutions #DKGoelAccounts #NCERTAccounts #DoubleEntryBookkeeping #CommerceStudents #Class11ExamPrep #ProfitOrLossOnSale