09 November 2013
my aunty has a old jewellery of around 3 years back , she now want to show in her balance sheet the jewellery can that be possible if yes how will the balance sheet be adjusted.
09 November 2013
That can be possible and the entry will be ;
Jewellery Dr. PL a/c Cr.
and the disclosure is required to this effect as per AS-4.
Why PL a/c is to credited : The reason is that, this case is as good as rectification entry that should had been passed three year back, and now it is to account for. Further, the value of above should be after notional depreciation of three year.
I think you don't have practical exposure, PL /ac is part of capital a/c.. Don't you know that PL a/c is added to capital a/c as last..
09 November 2013
Jewellery is not an income. Its addition to capital. Hence to be taken to balance sheet directly. No depreciation to be charged and has to be shown at historical cost. Market value may be shown in brackets as on balance sheet date.
CAclubindia
