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Deprecation under companies act

pratik dixit (article assistant) (49 Points)

13 June 2013

a company has purchased machines on the following dates first on 2nd may 2012, second on 13th sep 2012 and third on 3 jan 2013. how to charge depreciation on addtions to macinery as per companies act

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veeru sagar (BBE,M.com,CA Final ) (473 Points)
Replied 13 June 2013

As per the Company Act 1956. the depriciation charge on the machinary @ 15% .

Depriciation = value of machine *15%*(No of days used during the year /365)

using the above formula you can calculate the value of depriciation on all of machine . on the other hand Depriciation As per income tax charged . if you have purchased the machine on or before 2 October then depriciation would be calculated for whole year and if purchased on and after 3rd october than depriciation would be calculated for six month only