If our factory is working 3 shift and total working days are 304 of factory than deprecition charge by 365 days on additions or by 304 days i9n caculation of new addition.
3 Replies
Pijush Roy
(ERP SAP Functional Tester)
(281 Points)
Replied 18 July 2012
If fixed method followed, depreciation for 365 days calculated. Otherwise proportionate amount of depreciation charged. There are contraductory about this matter. If (365-304) =61 days is public holiday, then full year depreciation charged. If it happened for stick, lock out depreciation for normal working hours charegd on depreciation account & depreciation for lock period transfer to abnormal loss portion.
CA Sankalp Patwa
(CA)
(193 Points)
Replied 18 July 2012
If you are talking about companies act, then yes depreciation on additions would be charged on prorata basis i.e. for 304 days.
CA Rohit Maurya
(Associate)
(213 Points)
Replied 19 July 2012
ya i am talking about depreciation as per companies act.............still not cleared whether to charge depreciation on addition by 304 days or 365 days.
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