Revised schedule vi

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

19 November 2012 i have purchased a table on 01.12.12 for my cabin....and i have decided to sell it after 6 months....then whehter it would be current or non-current? Please give reasons also...

CA CS Amit S. Kedia

CA CS Amit S. Kedia (Expert)
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19 November 2012 Dear member, first of all pls check the date of purchase..
If you purchase it on that date as a fixed asset(not dealing in furniture) and want to sell it then why have you bought it???
Even if you have intention to sell the table then also it would be classified as non current asset only. There is no other choice/option

Querist : Anonymous

Querist : Anonymous (Querist)

19 November 2012 I know it would be a non-current asset...but just want to know the exact reason of the same as in an interview this question was asked from me....and when i said that intention is not to sell then he told suppose i have decided to sell it in april and purchase a new one then how would you classify and how would you determine intention?please give the reply...

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CA CS Amit S. Kedia

CA CS Amit S. Kedia (Expert)
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19 November 2012 If the management is having intention of sale and can substantiate it with the evidence then it can clssify it as assets held for sale under current investment.

Querist : Anonymous

Querist : Anonymous (Querist)

19 November 2012 In short my question is if on 31.03.12 we know that a particular fixed asset would be sold in april 12 then can we classify such fixed asset as 'Current Asset' by applying the criteria 'would be realized within 12 months from the reporting date'?

CA CS Amit S. Kedia

CA CS Amit S. Kedia (Expert)
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19 November 2012 Yes. then it would be classified as "assets held for sale" as current assets.