DEPRECIATION

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

22 February 2011 From the particulars given below calculate the amount of depreciation for the p.y. ending on 31-3-2010.
P&m 15% block.
1. WDV as on 1-4-2009 Rs. 17,00,000.
2. actual cost of new P&M acquired on 30-09-2008 but put into use on 1-11-2008 Rs. 12,00,000.
the depreciation @ 15% for this asset was calculated and charged to P&L account of 08-09 but its WDV
its not included in the above WDV.
3. actual cost of new P&m acquired on 31-3-09 but put to use on 06-10-09 Rs. 16,00,000.
4. an asset which was earlier used for scientific research has been transferred to this block on 1-11-09. its actual cost
in 04-05 was Rs. 24,00,000 and till 31-3-09 Rs. 12,50,000 has been debited to p&l account. the balance is being carried
forward

PLEASE SOLVE THIS QUESTION

CA. Lohith Jagadeesh

CA. Lohith Jagadeesh (Expert)
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22 February 2011 Hi

Will get back to u with complete wrkngs & Info

Thank you

Regards
CA.Lohith.J
B.Com,ACA,CS,(ICWA),SAPM Hons,ITR Hons

Asha Kanta Sharma online

Asha Kanta Sharma

(Expert)
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21 July 2024 To calculate the depreciation for the previous year ending on 31-3-2010, let's go through the particulars provided:

1. **Opening WDV as on 1-4-2009:** Rs. 17,00,000
- This is the written down value of the Plant & Machinery (P&M) block at the beginning of the year.

2. **Actual cost of new P&M acquired on 30-09-2008 but put into use on 1-11-2008:** Rs. 12,00,000
- The depreciation for this asset was already charged for the previous year (08-09) and is not included in the opening WDV of 17,00,000.

3. **Actual cost of new P&M acquired on 31-3-09 but put to use on 06-10-09:** Rs. 16,00,000
- This asset was acquired during the year and has to be added to the block.

4. **Asset transferred to the block on 1-11-09, earlier used for scientific research:**
- Actual cost up to 31-3-09: Rs. 12,50,000
- Balance to be added to the block: Rs. 24,00,000 - Rs. 12,50,000 = Rs. 11,50,000

Now, let's calculate the depreciation step by step:

### Step 1: Calculate the Opening WDV
- Opening WDV as on 1-4-2009: Rs. 17,00,000

### Step 2: Add the new assets acquired during the year
- New asset acquired on 31-3-09: Rs. 16,00,000
- Therefore, new additions to the block = Rs. 16,00,000

### Step 3: Add the balance of the transferred asset
- Balance transferred to the block from scientific research: Rs. 11,50,000

### Total WDV for the year (including new additions and transfers):
- Total WDV = Opening WDV + New additions + Transferred balance
- Total WDV = Rs. 17,00,000 + Rs. 16,00,000 + Rs. 11,50,000
- Total WDV = Rs. 44,50,000

### Step 4: Calculate Depreciation
- Depreciation is charged on the block at 15%.

### Annual Depreciation Calculation:
- Depreciation for the year = Total WDV * Rate of Depreciation
- Depreciation for the year = Rs. 44,50,000 * 15%
- Depreciation for the year = Rs. 6,67,500

### Conclusion:
- The depreciation for the previous year ending on 31-3-2010, based on the given particulars, is **Rs. 6,67,500**.

This calculation considers the opening WDV, new additions during the year, and the balance transferred from a different block, all of which contribute to the total block value on which depreciation is charged at 15%.

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