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DEPRECIATION and WDV

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vishal

134 Points Posted on 08 October 2021

A vehicle was purchased in 2016 in 180000/- and sold in 110000/- in current year for business no depreciation was charged on the vehicle till date and there is only one vehicle. now
1.What will and how to calculate
WDV on vehicle as rs 180000/- is showing in the books.
2.Should we charge depreciation for 5 years since 2016 in current year and debit the whole amount of depreciation in p&l acc along with profit or loss on vehicle. or
3.Should we calculate profit or loss without charging depreciation.
can anyone help and calculate it. thanks.

Replies (2)

Quick Summary

This discussion addresses how to handle depreciation and calculate the Written Down Value (WDV) for a business vehicle purchased in 2016 and sold recently. The user needs guidance on whether to charge five years of depreciation retroactively in the current year's profit and loss account, or to calculate the profit/loss on the sale without accounting for past depreciation. Advice suggests charging depreciation from the initial purchase date.