Calculating Property Sale Proceeds

To find the sale proceeds, we first need to determine the original cost of the property that was sold. We can do this by tracking the changes in the 'Property at Cost' balance.

Asset Balance Analysis

The balance of property at cost changed over the two years:

• Balance at the start of 2015: ₹ 20,000
• New property purchased in 2016: ₹ 5,000
• Balance at the end of 2016: ₹ 17,000

Determining Cost of Property Sold

The cost of the property sold can be calculated as follows:

Cost of Property Sold = (Opening Balance + New Purchases) - Closing Balance

Using LaTeX for the formula:

$Cost of Property Sold = (\text{₹ } 20,000 + \text{₹ } 5,000) - \text{₹ } 17,000$

$Cost of Property Sold = \text{₹ } 25,000 - \text{₹ } 17,000$

$Cost of Property Sold = \text{₹ } 8,000$

Calculating Sale Proceeds

The question states that a profit of ₹ 2,000 was made on the sale and credited to the Capital Reserve Account. The sale proceeds are the sum of the cost of the asset sold and the profit made on its sale.

Sale Proceeds = Cost of Property Sold + Profit on Sale

Using LaTeX:

$Sale Proceeds = \text{₹ } 8,000 + \text{₹ } 2,000$

$Sale Proceeds = \text{₹ } 10,000$

Therefore, the sale proceeds from the property amounted to ₹ 10,000.