Depreciation on live stock
This query is : Open
17 August 2013
A CIRCUS OWNER OWNS ELEPHANT. WILL IT BE TREATED AS FIXED ASSET ? IS IT DEPRECIABLE ASSET ?
WHAT WOULD BE ACCOUNTING ENTRY ON DEATH OF ELEPHANT.?
ANSWER ALL QUESTIONS SEPARATELY PLEASE.
WHAT WOULD BE ACCOUNTING ENTRY ON DEATH OF ELEPHANT.?
ANSWER ALL QUESTIONS SEPARATELY PLEASE.
18 August 2013
Depreciation on assets shall be charge according to the Accounting standard-6.
According to such standard, AS-6 doesn't apply to the Live stock, I.e means depreciation on live stock doesn't deal by AS-6, as well as any other provisions of Income tax or accounting standards etc... doesn't deal with the accounting of live stock.
So according to my view depreciation on live stock(assets) shall not be charge because of we can't estimate the age of the live assets as well as can't decide the rate of depreciation so at the time of death of live asset the value of the asset as per books(cost) shall be treat as loss and debit to the Profit and loss account.
The above is just my opinion not the perfect solution.
So please wait for other expert's view and suggestions they may help with any case laws or studies etc...
Keeping this as open query for other experts comments.
OM SAI SRI SAI JAI JAI SAI
According to such standard, AS-6 doesn't apply to the Live stock, I.e means depreciation on live stock doesn't deal by AS-6, as well as any other provisions of Income tax or accounting standards etc... doesn't deal with the accounting of live stock.
So according to my view depreciation on live stock(assets) shall not be charge because of we can't estimate the age of the live assets as well as can't decide the rate of depreciation so at the time of death of live asset the value of the asset as per books(cost) shall be treat as loss and debit to the Profit and loss account.
The above is just my opinion not the perfect solution.
So please wait for other expert's view and suggestions they may help with any case laws or studies etc...
Keeping this as open query for other experts comments.
OM SAI SRI SAI JAI JAI SAI
Message likes :
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18 August 2013
Can we amortise the amount of live stock over say 5 years instead of calling it as depreciation, instead of charging full amount to p-l account on the event of death.??
expecting an answer ....thanks.
expecting an answer ....thanks.
19 August 2013
Yes, you can do like that, Because of any accounting standard doesn't dealing with the live stock accounting i.e means there is no particular treatment or accounting for the live stock, so you can follow what you like accounting policy.
However such policy shall be indicate by the auditor in his audit report if applicable.
OM SAI SRI SAI JAI JAI SAI
However such policy shall be indicate by the auditor in his audit report if applicable.
OM SAI SRI SAI JAI JAI SAI
20 August 2013
Thanks for REply.
What if there is addition to the live stock at no cost?.. i mean birth given to child by any animal.
how will this be treated in accounts..?
how to account for the expenses incurred on development of hybrid category.. would it be as per AS 26 or how ??
What if there is addition to the live stock at no cost?.. i mean birth given to child by any animal.
how will this be treated in accounts..?
how to account for the expenses incurred on development of hybrid category.. would it be as per AS 26 or how ??
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