Depreciation Accounting

This query is : Resolved

Guest

Guest (Querist)

10 July 2011 Please suggest on how depreciation will be charged in following situation as per the Co.Act and IT Act

Date of Purchase of Plant and Machinery: 15th Sept 201X
Price paid to vendor on account of Purchase of P&M: Rs. 150,000/-
Date of Installation: 8th Oct 201X
Price Paid for Installation of P&M : Rs. 15,000/-

As per my understanding depreciation as per Co Act shld be
Depreciation :

150000*(31st march-15th Sept)/365*Rate of Dep

(+)

15000*(31st March-8th Oct)/365*Rate of Dep

Please correct me if i am wrong...

Thanks

Guest

Guest (Querist)

10 July 2011 Waiting for the suggestions of the experts...

vijayakumar.sure

vijayakumar.sure (Expert)
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11 July 2011 You need to take depreciation on 150000+15000 from date of instillation (assuming the same as date of put to use)

T.K. JAGANATHAN

T.K. JAGANATHAN (Expert)
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11 July 2011 Depreciation should be considered only from the date put to use ( Commercial production) for the total value)

C A S.S.Agarwal, M.Com.,LL.B,

C A S.S.Agarwal, M.Com.,LL.B, (Expert)
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11 July 2011 As per the companies act the depreciation is to be charged on per day basis and it depends whether you are following SLM or WDV Method.

As per Income Tax Act it is less then 180 day half depreciation more than 180 days of user is full deprecaiton

avdhesh varshney

avdhesh varshney (Expert)
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13 July 2011 you ar erequired to charge the dep. from the date of installation as per compnies act.
i.e. on Rs 150000+15000 and as per days basis, wrt slm or wdv u r following !

keep it up !