In 15% block there is a car with Opening Balance of Rs.430451/- and the same was sold in Rs350000/- and a new car is purchase on 18-12-2011 worth Rs.884209/- how to compute depreciation in this case ?
Point to be explianed- 1) Can depreciation can be claimed for Old Car and if not why?
Depreciation here should be claimed on block basis here and the total value of the block can be aggregated to arrive at the final depreciable value..
add the value of first car, subtract the value of sale and add the car purchased again, and then charge the depreciation , this is called as block calculation.
| Originally posted by : Jay Prakash Mishra | ||
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In 15% block there is a car with Opening Balance of Rs.430451/- and the same was sold in Rs350000/- and a new car is purchase on 18-12-2011 worth Rs.884209/- how to compute depreciation in this case ? Point to be explianed- 1) Can depreciation can be claimed for Old Car and if not why? |
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Closing balance=[(430451-350000)+884209]=964660.
Of the above:
Depreciation @ 7.5%(since used for less than 180 days)=884209*7.5%=66315
Depreciation @ 15%=(964660-884209)*15%=12067
Total Depreciation=78382
Closing WDV=964660-78382=886278
Regards,
RA
Dear
Jay Prakash Mishra,
Kindly find the file attached which will give you an idea of depreciation calculation
Regards,
BisHwaJeet
Could some one explain why in this case it should be block Depreciation. the old car can be written off and the differnce can be transfered to P&L, loss or gain on sale of FA. and new car be brought in FA register.
Prasad under IT Act assets are classified into Block of Assets and computation is done as follws
Opening Balance
Add:Purchases
Less:Sales
Closing Balance
Less:Depreciation
Closing WDV
Prasad under IT Act assets are classified into Block of Assets and computation is done as follws
Opening Balance
Add:Purchases
Less:Sales
Closing Balance
Less:Depreciation
Closing WDV
CAclubindia
