Page 14 - 15. COMPILER QB - INDAS 21

SOLUTION

Journal Entries
Purchase of Machinery on credit basis on 30th January 2020.21:
Rs. Rs.
Machinery A/c (10,200 X 57.68) Dr. 5,88,336
To Creditors-Machinery 5,88,336
(Initial transaction will be recorded at exchange rate on the
date of transaction)

Exchange difference arising on translating monetary item on 31st March 2020.21:
Rs. Rs.
Profit & Loss A/c [(10,200 X 57.68) – (10,200 X 62.12)] Dr 45,288
To Creditors-Machinery 45,288
Machinery A/c Dr. 45,288
To Revaluation Surplus (OCI) 45,288
(Initial transaction will be recorded at exchange rate on the date of
transaction)
Machinery A/c Dr. 1,18,028
To Revaluation Surplus (OCI) 1,18,028
(Being Machinery measured at the exchange rate on 31-03-2020 [USD
12,100 x (Rs 62.12 - Rs 57.68)]
Revaluation Surplus (OCI) Dr. 40,829
To Deferred Tax Liability 40,829

(DTL created @ of 25% of the total OCI amount)

Exchange difference arising on translating monetary item and settlement of creditors on 31st March
2021:
Rs. Rs.
Creditors-Machinery A/c (10,200 X 62.12) Dr. 5,88,336
Profit & loss A/c [(10,200 X ($ 69.24 -$ 62.12)] Dr. 72,624
To Bank A/c 6,60,960
Machinery A/c [(12,100 x ($ 69.24 - $ 62.12)) Dr. 86,152
Revaluation Surplus (OCI) 86,152
Revaluation Surplus (OCI) Dr. 21,538

To Deferred Tax Liability 21,538
(DTL created @ of 25% of the OCI amount)

15. 13