On first jan,2006,Ram Ltd purchase 5 cars costing Rs 100000 each from delhi motors on hire purchase system.The payment was to be made as Rs 100000 down and the balance in four equal inatalments of Rs 100000 each together with interest at 12% p.a. Rama Ltd write off depreciation at 10% p.a. on straight line method.Rama Ltd could not pay the instalment due to on 31st December,2007.After negotiations,Delhi nMotors agreed to leave 2 cars with the purchaser adjusting the value of other three cars against the amount due to at 20% p.a. on written down value method.Delhi Motors spend Rs.15000 on repair of cars and sold them for Rs 220000 on 31st may,2008.Show necessary accounts in the books of both the parties.

It would be better if you were to post your own solution for corrections and guidance. I would also suggest that you refer to the books by Shukla and Grewal, Mukhejee and Hanif, Maheshwari and Maheshwari.

As far as I can recall this question appears as an exmple in Mukherjee and Hanif.

It would be better if you were to post your own solution for corrections and guidance. I would also suggest that you refer to the books by Shukla and Grewal, Mukhejee and Hanif, Maheshwari and Maheshwari.

As far as I can recall this question appears as an example in Mukherjee and Hanif.