The cost of plant in use with Hand Sanitizer Ltd (Hand Sanitizer), a manufacturing firm on 1 st April 2018 was GH₵375,000 against which the accumulated depreciation stood at GH₵157,500 on that date. The firm provided depreciation at 30% of the diminishing value. On 31st December 2018 two plants costing GH₵22,500 and GH₵18,000 respectively, both purchased on 1st October 2015, had to be discarded because of damages and had to be replaced by two new plants costing GH₵30,000 and GH₵22,500 respectively. One of the discarded plants was sold for GH₵12,000, against the other it was expected that GH₵4,500 would be realisable. Required: Show the relevant accounts in the ledger of Hand Sanitizer for the year ended 31st March 2019

Hand Sanitizer Ltd

Relevant Accounts for the year ended 31st March 2019:

1. Plant Account:

Debit Balance on 1st April 2018 = GH₵375,000

Credit: Disposal of Plants on 31st December 2018   = GH₵40,500 (GH₵22,500 and GH₵18,000)

Debit: New Plants on 31st December 2018 = GH₵52,500

Debit Balance on 31st March 2019 = GH₵387,000

2. Accumulated Depreciation - Plant:

Credit Balance on 1st April 2018 = GH₵157,500

Debit: Disposal of Plants on 31st December, 2018 = GH₵27,427.10

Credit: Depreciation Expense ( 100,350 + 3,937.50) = GH₵104,287.50

Credit Balance on 31st March 2019 = GH₵234,360.40

3. Depreciation Expense:

Debit: Accumulated Depreciation for old plant GH₵100,350

Debit: Accumulated Depreciation for new plants GH₵3,937.50

Total = GH₵104,287.50

4. Disposal of Plants Account:

Debit: Plants = GH₵40,500

Credit: Accumulated Depreciation = GH₵27,427.10

Credit: Cash = GH₵16,500 (12,000 + 4,500)

Debit: Gain from Sale = GH₵3,427.10

Balance = GH₵0

Explanation:

a) Accumulated Depreciation for the disposed plants on reduced balance:

October 2015 to March 2016 for 6 months (30% of GH₵40,500 for 6 months) = GH₵6,075

March 2017 for 12 months = GH₵10,327.50

March 2018 for 12 months = GH₵7,229.25

December 2018 for 9 months = GH₵3,795.35

Total = GH₵27,427.10

b) Reduced Balance for Disposed Plants

October 2015 Cost = GH₵40,500

March 2016 less Depreciation = GH₵6,075

Reduced Balance = GH₵34,425

March 2017 less Depreciation = GH₵10,327.50

Reduced Balance = GH₵24,097.50

March 2018 less Depreciation = GH₵7,229.25

Reduced Balance = GH₵16,868.25

December 2018  less Depreciation = GH₵3,795.35

Reduced Balance = GH₵13,072.90

The depreciation charge for 2016 was for 6 months while the 2018 charge was for 9 months.

ans.

heterothermic organisms include those organisms that can switch between homeothermic (having body temperature higher than environment) and poikilothermic (having variation in internal body temperature) strategies.

some migratory birds show heterothermy as they decrease their metabolic rate during cold nights to keep their body temperature low. drop in metabolic rate allows increase in production efficiency of birds that reduces the internal body temperature to make it equal to external cold temperature during cold nights.

thus, the correct answer is 'birds allow their temperature drop in order to increase their production efficiency.'