16 November 2014
If i buy Shares/ Mutual fund Units for Rs. 1000 on 01.04.2013, Market Value of it on 31.03.2014 Rs. 1200, I sell it on 30.04.2014 for Rs. 1250.
How can accounting be done ???
(1) Ans 1: on 31.03.14 Income Receivable Dr. 200 [Current Assets] Income Cr. 200 [P & L A/c.] >> and Investment Shown in B/S at Cost on 31.03.14.
On 30.04.2014 Bank Dr. 1250 Investment Cr. 1000 Income Receivable Cr. 200 Income Cr. 50
(2) Ans 2: on 31.03.14 Investment Dr. 200 [Investments] Income Cr. 200 [P & L A/c.] >> and Investment Shown in B/S at Market Value on 31.03.14.
On 30.04.2014 Bank Dr. 1250 Investment Cr. 1200 Income Cr. 50
Correct Ans is any of Above, or Any Else ?? Please Suggest me. - Akash Unadkat
18 November 2014
No need to account for the market value as on 31/03/2014. (Conservative principle.) Pass the entry on 30/04/2014 itself. . . The market value of the shares/mutual fund can be reported by way of foot note.
23 November 2014
But if it would be for many years, like 5-10 then what ?? after 5-10 years, there will be much big figure of income, and pay higher tax. where in actual its is collected amount for 5-10 years investment.
23 November 2014
Shares : It will go to Long Term Capital Gain (I think you are aiming at MARKET value method of accounting. It is NOT yet recomended in India)Your views please.
CAclubindia
