Depreciation

Shameer Kuppanath (article assistant) (52 Points)

17 April 2010

Dear Students and ma friends,

please help me to get an idea about the entries can be made regarding "Depreciation entries"

Question: How we can enter the depreciation entry for sold property with a loss................?

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4 Replies

amandeep Singh (student) (24 Points)
Replied 17 April 2010

hi shameer,

suppose an asset with cost - 100 and A. Depn - 40 is discarded

then entry willl be as follows:

Accumulated Depn A/c Dr. 40

Loss on asset discarded A/c Dr. 60

To Asset(Original Cost) A/c 100

Regards,

Aman

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TRILOCHAN (SENIOR ACCOUNTANT) (698 Points)
Replied 17 April 2010

First of all i would like to say that, if u sold the asset during the year, then no depreciation will be charged and the only entry will be..

party a/c dr

loss on sale of asset dr

to asset a/c

(Guest)

For Income tax purpose no entry is made.

but for accounting purpose we charge depreciation. take an exappmle.

wdv of asset =50 lacs rate of depreciation 10% (asset sold on 30september for Rs 25 lacs.)

entry will be as follows.

depreciation.....................................................dr 2.5 lacs

Bank/party..........................................................dr 25 lacs

loss on sale of asset.......................................dr 22.5 lacs

to asset account 50 lacs

Raj Saxena (1412th Tiger) (Struggling Student) (272 Points)
Replied 18 April 2010

Originally posted by : Mosharraf Raza
	For Income tax purpose no entry is made. but for accounting purpose we charge depreciation. take an exappmle. wdv of asset =50 lacs rate of depreciation 10% (asset sold on 30september for Rs 25 lacs.) entry will be as follows. depreciation.....................................................dr 2.5 lacs Bank/party..........................................................dr 25 lacs loss on sale of asset.......................................dr 22.5 lacs to asset account 50 lacs