New Financial Accounting (BCOC-131) - New

Bank A/c Dr. \tTo Equity Share Capital A/c (Being issue of equity shares for cash).

The main parties to a bill of exchange are: (1) Drawer—the person who draws the bill (usually the seller/creditor). (2) Drawee/Acceptor—the person on whom the bill is drawn and who accepts it, thereby becoming legally liable to pay (usually the buyer/debtor). (3) Payee—the person entitled to receive payment (often the drawer himself). If the bill is transferred, there may also be an endorser and endorsee.

Depreciation can be computed by different methods depending on the nature of asset usage. Two common methods are Straight Line Method (SLM) and Written Down Value (WDV).

Under SLM, depreciation is a fixed amount each year based on (Cost − Scrap)/Useful life. It is simple, gives uniform annual charge and suits assets with uniform benefits.

Under WDV, depreciation is charged at a fixed rate on the reducing book value. The charge is higher in early years and lower later, which matches higher repair costs in later years and suits assets that lose efficiency quickly.

Thus, SLM provides uniform charge, while WDV provides diminishing charge and a more realistic matching for certain assets.