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TS Grewal Class 11 Accountancy Chapter 13 Depreciation Accounting Solutions

TS Grewal Class 11 Accountancy Chapter 13 Depreciation Accounting Solutions

Q: 1. What is the step-by-step method to solve a practical problem on depreciation using the Straight-Line Method (SLM) from TS Grewal Class 11, Chapter 13?

To solve a problem using the Straight-Line Method (SLM) as per TS Grewal solutions for the 2025-26 session, you should follow these steps:Step 1: Determine the original cost of the asset, including purchase price, freight, and installation charges.Step 2: Estimate the scrap value (residual value) of the asset at the end of its useful life.Step 3: Calculate the annual depreciation amount using the formula: (Original Cost - Scrap Value) / Useful Life of the Asset.Step 4: Debit the Depreciation Account and credit the Asset Account with the calculated annual depreciation amount for each year.Step 5: Repeat this process consistently every year until the asset's book value equals its scrap value. This method ensures the same amount of depreciation is charged annually.

Q: 2. How do you correctly calculate and record depreciation using the Written Down Value (WDV) method as per the solutions in TS Grewal's textbook?

The solutions for the Written Down Value (WDV) or Diminishing Balance Method in TS Grewal involve a specific procedure:Step 1: Identify the opening book value of the asset. For the first year, this is the original cost.Step 2: Apply the given percentage rate of depreciation to this book value. For example, if the book value is ₹1,00,000 and the rate is 10%, the first year's depreciation is ₹10,000.Step 3: Calculate the closing book value by subtracting the depreciation amount from the opening book value (₹1,00,000 - ₹10,000 = ₹90,000).Step 4: For the next year, this closing value (₹90,000) becomes the new opening book value. The depreciation is then calculated on this reduced amount. This process results in a decreasing depreciation charge each year.

Q: 5. Why is preparing a separate 'Provision for Depreciation Account' a preferred method in some TS Grewal solutions, and how is it done?

Preparing a separate 'Provision for Depreciation Account' (also known as 'Accumulated Depreciation Account') is preferred because it allows the Asset Account to always be shown at its original cost. This provides a clearer picture of the initial investment. The method is:Depreciation Entry: Instead of crediting the Asset Account, the annual depreciation is credited to the Provision for Depreciation Account. The journal entry is: Depreciation A/c Dr. To Provision for Depreciation A/c.Balance Sheet: The asset is shown at its original cost on the Assets side, and the Provision for Depreciation is shown as a deduction from it.On Sale of Asset: When the asset is sold, the accumulated depreciation related to that specific asset is transferred from the Provision for Depreciation Account to the Asset Account to determine the profit or loss.

Q: 7. What is the underlying accounting logic for calculating profit or loss on the sale of an asset, and how is it presented step-by-step in the solutions?

The logic is based on the matching principle. The book value of an asset represents the portion of its cost that has not yet been charged as an expense. When you sell it, you receive cash (an inflow). The profit or loss is the difference between the economic benefit received (sale price) and the economic benefit given up (book value of the asset). The TS Grewal solutions present this logic by:First, bringing the asset's value up-to-date by charging depreciation until the sale date.Next, calculating its precise book value at that moment.Finally, creating an entry to remove the asset from the books and recognise the resulting profit or loss, which is then transferred to the Profit & Loss Account. This concept is fundamental to Depreciation accounting.

TS Grewal Solution Available on Vedantu

Errors are everywhere, and when they end up coming into your accounts, that’s when the trouble starts to stack up. Accounts are responsible for maintaining every monetary transaction of an organisation, so they need to be accurate.

With the TS Grewal Solutions Class 11 Accountancy Chapter 13, we are trying to discuss various types of errors that can come up in your accounts and the different procedures to rectify them to make the calculations accurate.

The technique of rectifying inaccuracies committed to documenting transactions is referred to as rectification of errors. These errors can happen while posting entries to ledger accounts, categorising accounts, carrying forward balances, and so forth.

The mistakes are divided into two categories:

Correction of errors that have no impact on the trial balance
Correction of errors that have an impact on the trial balance

Errors Not Affecting the Trial Balance

This type of error happens mostly in two or more accounts at the same time. As a result, these errors are said to be two-sided errors. Inaccuracies that do not affect the trial balance, such as those including errors on both sides of the debit and credit, can be corrected by passing a journal entry.

Two-sided mistakes are errors that have an impact on two accounts at the same time. Errors can occur on both the debit and credit sides of the account, and they must be remedied or rectified by submitting a journal entry to rectify the debit and credit.

A mistake can be corrected by reversing the impact of a bad debit or credit entry and restoring the right debit or credit entry.

When there is an excess of credit or a shortfall of debit, the account should be debited; similarly, when there is a shortage of credit and an excess of debit, the account should be credited.

Rectification of Errors Affecting the Trial Balance

This type of error only affects one account in the transaction. As a result, it is said to be a one-sided error. To get this error out of the system, one has to give an explanatory note in the account or pass a journal entry with the help of Suspense A/C.

Errors that affect the trial balance can arise on any side of the trial balance, and these errors can only be corrected by passing a journal entry and creating a suspense account.

Such mistakes are sometimes referred to as one-sided errors since they affect only one side of the account (either debit or credit). Such inaccuracies can be corrected by adding a note to the account or by forwarding a journal item through the Suspense account.

The correction procedure is as follows:

Identification of the account that has a problem.
Determine if the account has a deficiency or an excess.
If a discrepancy arises as a result of an excess of credit and a deficit of debit, debit the account with the difference amount as calculated previously.
If there is a discrepancy owing to an excess of debit and a lack of credit, credit the account with the difference.

In addition to this, in class 11 ts Grewal solutions chapter 13 pdf, there is one more method that can help you solve this error: checking for the error before posting it to the ledger. One can simply cross the wrong amount and write the correct amount above it.

Rectification of Errors in Next Accounting Year

When the error cannot be located before the finalisation of accounts, it needs to be carried on the balance of the Suspense A/C for the next financial year. When the errors that were made in the previous year were fixed, they need to route back to the profit and the loss adjustment A/c for the expenses, losses, incomes, and gains. Thus, making the impact of the error null on the current income statement.

In Conclusion to Class 11 TS Grewal Solution Rectification of Errors

There you have it, and these are some of the class 11 accountancy ts Grewal solutions solution chapter 13 rectification of errors. You can easily download the class 11 ts Grewal solutions chapter 13 pdf from our website and read it anytime you want.

FAQs on TS Grewal Class 11 Accountancy Chapter 13 Depreciation Accounting Solutions

1. What is the step-by-step method to solve a practical problem on depreciation using the Straight-Line Method (SLM) from TS Grewal Class 11, Chapter 13?

To solve a problem using the Straight-Line Method (SLM) as per TS Grewal solutions for the 2025-26 session, you should follow these steps:

Step 1: Determine the original cost of the asset, including purchase price, freight, and installation charges.
Step 2: Estimate the scrap value (residual value) of the asset at the end of its useful life.
Step 3: Calculate the annual depreciation amount using the formula: (Original Cost - Scrap Value) / Useful Life of the Asset.
Step 4: Debit the Depreciation Account and credit the Asset Account with the calculated annual depreciation amount for each year.
Step 5: Repeat this process consistently every year until the asset's book value equals its scrap value. This method ensures the same amount of depreciation is charged annually.

2. How do you correctly calculate and record depreciation using the Written Down Value (WDV) method as per the solutions in TS Grewal's textbook?

The solutions for the Written Down Value (WDV) or Diminishing Balance Method in TS Grewal involve a specific procedure:

Step 1: Identify the opening book value of the asset. For the first year, this is the original cost.
Step 2: Apply the given percentage rate of depreciation to this book value. For example, if the book value is ₹1,00,000 and the rate is 10%, the first year's depreciation is ₹10,000.
Step 3: Calculate the closing book value by subtracting the depreciation amount from the opening book value (₹1,00,000 - ₹10,000 = ₹90,000).
Step 4: For the next year, this closing value (₹90,000) becomes the new opening book value. The depreciation is then calculated on this reduced amount. This process results in a decreasing depreciation charge each year.

3. How are the solutions for problems involving the sale of an asset during the financial year structured in TS Grewal Class 11 solutions?

When solving a problem involving the sale of an asset, the solutions are structured to accurately calculate profit or loss. The key steps are:

Step 1: Charge depreciation on the asset being sold, but only for the period it was used in the current financial year (from the beginning of the year until the date of sale).
Step 2: Determine the book value of the asset on the date of sale. This is calculated as (Original Cost - Total Accumulated Depreciation until the date of sale).
Step 3: Compare this book value with the sale price. If the sale price is higher, it is a profit. If the sale price is lower, it is a loss.
Step 4: Record the transaction by crediting the Asset Account with the sale proceeds and debiting/crediting the Profit & Loss Account for the calculated profit or loss.

4. What is the correct step-by-step journal entry process for recording depreciation and the subsequent sale of an asset?

The correct journal entry process as per CBSE guidelines for the 2025-26 syllabus is as follows:

For charging depreciation:
Depreciation A/c ... Dr.
To Asset A/c
(Being depreciation charged on the asset)
For the sale of an asset:
Bank/Cash A/c ... Dr. (with sale proceeds)
To Asset A/c (with the book value on date of sale)
For recording profit on sale:
Asset A/c ... Dr.
To Profit & Loss A/c
For recording loss on sale:
Profit & Loss A/c ... Dr.
To Asset A/c

Following this sequence ensures that all aspects of the transaction are correctly reflected in the books of accounts. For a deeper understanding, you can refer to the NCERT Solution for Class 11 Accountancy All Chapters.

5. Why is preparing a separate 'Provision for Depreciation Account' a preferred method in some TS Grewal solutions, and how is it done?

Preparing a separate 'Provision for Depreciation Account' (also known as 'Accumulated Depreciation Account') is preferred because it allows the Asset Account to always be shown at its original cost. This provides a clearer picture of the initial investment. The method is:

Depreciation Entry: Instead of crediting the Asset Account, the annual depreciation is credited to the Provision for Depreciation Account. The journal entry is: Depreciation A/c Dr. To Provision for Depreciation A/c.
Balance Sheet: The asset is shown at its original cost on the Assets side, and the Provision for Depreciation is shown as a deduction from it.
On Sale of Asset: When the asset is sold, the accumulated depreciation related to that specific asset is transferred from the Provision for Depreciation Account to the Asset Account to determine the profit or loss.

6. How does the TS Grewal solution for an asset purchased in the middle of a financial year differ from one purchased at the beginning?

The key difference in the solution lies in the calculation of the first year's depreciation. If an asset is purchased at the beginning of the year, a full 12 months of depreciation is charged. However, if an asset is purchased in the middle of the year (e.g., on October 1st), the solution will correctly show depreciation calculated only for the period the asset was in use. For an October 1st purchase, this would be for 6 months (October to March). The calculation would be: (Annual Depreciation Amount) x (6/12). Subsequent years will have depreciation charged for the full 12 months.

7. What is the underlying accounting logic for calculating profit or loss on the sale of an asset, and how is it presented step-by-step in the solutions?

The logic is based on the matching principle. The book value of an asset represents the portion of its cost that has not yet been charged as an expense. When you sell it, you receive cash (an inflow). The profit or loss is the difference between the economic benefit received (sale price) and the economic benefit given up (book value of the asset). The TS Grewal solutions present this logic by:

First, bringing the asset's value up-to-date by charging depreciation until the sale date.
Next, calculating its precise book value at that moment.
Finally, creating an entry to remove the asset from the books and recognise the resulting profit or loss, which is then transferred to the Profit & Loss Account. This concept is fundamental to Depreciation accounting.