27 October 2015
If the carrying amount as on 31.03.2014 is less than 5% of original cost, should we adjust the difference with the opening balance of retaied earnings or take the asset at the residual vaule of 5% of orinal cost as o 31.03.2015? what is the treatment with explanation? Example Original cost of asset - Rs 1000 Carrying Cost as on 31.03.2014- Rs48 Useful life of asset sch II- 10 years Purchase date of assset - 1.3.2000 Residual value- 5%1000 = Rs.50
27 October 2015
No adjustment is required as per companies act 2013. Residual value can be less than 5% as per companies act 2013. Only lesser depreciation charged in earlier years has to be adjusted against retained earnings.
27 October 2015
what is the treatment in below example: Original cost of asset - 10000 WD.V. as on 31.03.2014- 48 Useful life of asset- 10years Remaining life of asset as on 31.03.2014 is NIL. hOW MUCH AMOUNT IS TRANSFERRED IN RETAINED EARNING? AND WHAT IS THE TREATMENT IF carring cost of assset is less then residual value of asset(i.e. less than 5% of original cost)??
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