rakesh kumar verma (IPCC) (75 Points)
12 August 2012Please solve this question according AS-6
A machine of cost 1,20,000 is depreciated straight-line assuming 10 year working life and zero
Residual value for three years. The estimate of remaining useful life after third year was reassessed at 5 years.
Also clear the concept highlited by yellow color .
Janbaz Shaikh
(Praticing )
(40 Points)
Replied 12 August 2012
Hi Rakesh
First split the question as
1.In the standpoint of 1st year Machine cost is Rs.1,20,000/- and the depreciation provided as straightline for Rs.12000/- each for 10 years.
2.In the standponit of 3rd year the useful period of assets are revised as 5 more years only (Totally 8 years) and Zero residual value.Hence balance unprovided depreciation of Rs.84000/- (1,20,000-12000-12000-12000), we have to provided in next 5 years as Rs.16,800/- (84000/5)
Mukund
(CA Final (New) Group One Cleared)
(177 Points)
Replied 13 August 2012
As per para 11 of AS - 6, If the Original estimated useful life undergoes any change, the unamortised depreciation should be charged to revenue over revised useful life. Therefore, For years 1, 2 and 3, depreciation would be s. 12000/- pa. For the rest five years depreciation would be Rs. 16,800/- pa.
satish kumar Chauhan
(accountant)
(345 Points)
Replied 13 August 2012
depreciation should be charged to revenue over revised useful life. Therefore, For years 1, 2 and 3, depreciation would be s. 12000/- pa. For the rest five years depreciation would be Rs. 16,800/- pa.
Analysis of 20 GST Notices (including 2 Appeals) and Practise on Drafting(with recording)
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