A firm had only one car ( 15% Dep Block): WDV= Rs. 5,60,000. Sold on 1st June at 2021.at Rs. 4,00,000/- How much amount to be eligible for Depreciation? Since the Block ceased to exist, whether balance { Rs. 1.60 Lakh less Depreciation) to be shown as Capital Loss OR the entire Rs. 1,60,000/- may be shown as Depreciation. In any case, the amount to be charged to P&L Account. What would be the correct presentation ? Seeking your valued opinion.
4 Replies
Dhirajlal Rambhia
(SEO Sai Gr. Hosp.)
(177741 Points)
Replied 03 September 2022
Rs. 1,60,000/- loss will be charged to P&L acc...
CA Rashmi Gandhi
(Chartered Accountant)
(86323 Points)
Replied 03 September 2022
Capital Loss of Rs. 160000 shown as Short term capital loss
Rajib Saha
(Accounts Officer)
(239 Points)
Replied 04 September 2022
To Dhirajlal Sir,
Thanks a lot for your valued opinion.
Yasaswi Gomes new
(Finance )
(4514 Points)
Replied 06 September 2022
Yes i got you all. AS standard, i didn't go through it completely or kissed this part. But in Indas, the car will be measured at lower of cost or fair value less costs to sell. The carrying amount cannot have depreciation because it will be stopped for the period you've held the car for sale. The loss will be directly recognised here as well and no depreciation
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