determine the amount of depreciation

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

15 December 2009 Mr.X Purchased a Shop in the Multi- Stored Marketing Complex for Rs.10 lakhs, after that he constructed a Show Room in that shop and started a Proprietorship Business. The construction cost of the show room is Rs. 12 lakhs. Please determine the amount of depreciation (rate of depreciation :10%).

Heera Nahariya

Heera Nahariya (Expert)
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15 December 2009 (10+12)*10%
=2.2

Querist : Anonymous

Querist : Anonymous (Querist)

15 December 2009 Sir, but i think,the cost of Shop Rs.10 lack should not consider for depreciation.Because day by day the value of shop is increasing, how can it's value depreciate ? Only cost of construction of Show Room consider for depreciation i.e. 10% of 12 lakhs = 1.2 lakhs. (i am not sure but it is my view).
Thanks.

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