Servixe tax charge on reimbrushments

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Aditya (Querist)
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03 September 2012 M/s Gama & Co. is planning of installing a power saving machine and are considering buying or leasing alternative. The machine is subject to straight-line method of depreciation. Gama & Co. can raise debt at 14% payable in five equal annual installments of Rs. 1,78,858 each, at the beginning of the year. In case of leasing, the company would be required to pay an annual end of year rent of 25% of the cost of machine for 5 years.

The Company is in 40% tax bracket. The salvage value is estimated at Rs. 24,998 at the end of 5 years.

Evaluate the two alternatives and advise the company by considering after tax cost of debt concept under both alternatives.

P.V. factors 0.9225, 0.8510, 0.7851, 0.7242, 0.6681 respectively for 1 to 5 years.

how to calculate cost of machine by installment

Querist : Anonymous

Querist : Anonymous (Querist)

03 September 2012 DEAR SIR,

OUR C & F AGENTS WILL MAKE THE DEBIT NOTE FOR REIMBURSEMENT WITH SERVICE TAX OR WITHOUT SERVICE TAX. REIMBURSEMENT LIKE RENT, TELEPHONE, STAFF TRAVELING,FREIGHT, COURIER OR PARCEL CHARGES & SALARY, ELECTRIC BILLS ETC.

PLS. DO THE NEEDFUL OR URGENT BASIS.

THANK YOU

AJAY DUBEY

CA LOKESH KASAT, FCA, M.Com

CA LOKESH KASAT, FCA, M.Com (Expert)
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27 April 2015 Very old Query. Now not to be answered

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CMA. CS. Sanjay Gupta

CMA. CS. Sanjay Gupta (Expert)
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27 April 2015 Lokesh Ji you are so qualified still you prefer to reply on old queries which are not to be answered instead of answering to queries which are new and need to be answered. Please avoid this easy way of increasing replies and points. Requested to share your knowledge on queries where there is need for replies.

Hope you take it in a positive way.