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Depreciation as per schedule ii

Ritzz (CA Final - Article ) (365 Points)

28 June 2016

Hi Friends I have a query. Some assets have a net block in the books of the company, however as per the Schedule II its useful life has already has already expired. How will the net block be treated that is still in the books of the company as on 31.03.2016? Kind Regards

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Harshit Kabra (INVESTOR) (Student CA final) (1113 Points)
Replied 28 June 2016

hllo mr. Ritzz

u have to check wheather in which year the useful life has expired as in that Assessment year the proportianate amount of the asset used in that year should be transferred to Reserve and surplus as a -ve figuare.

further, after that Assessment year , in all next coming assessment year it should be valued at salvedged value @ 5%.

hope this will help u.

if u have further query , feel free to contact +918955737073

thnks

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Harshit Kabra (INVESTOR) (Student CA final) (1113 Points)
Replied 28 June 2016

here i'm showing u an example

suppose cost is 100000 at fy2015-2016 wdv is the rs. 7000 and salvage value is 5% ie 5000 at end of this fy the remaining useful life 1075 days but if upto this year life is passed more than 1075 days but less than (1075+366)days say 1120 days then excess should be transfrred to reserve ie.7000-5000 = 2000(should be shown as -ve figure in reserve and surplus)

and rs 5000 should be shown asset value.

hope u understood clearly.

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Ritzz (CA Final - Article ) (365 Points)
Replied 28 June 2016

Thank you so much Harshit for your kind help! I am more clear with the entire concept now

Kind Regards

Senu Reddy (ca final) (291 Points)
Replied 28 June 2016

i have no details regarding date of purchase and addition details of the previous yeras , except addition for the current year purchases so how shuld i calculate current year depreciation