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Depreciaiton calculation

jhonny (NA) (156 Points)

13 June 2016

Dear friends,

A pvt limited company has bought the following on 30 May 2015.

Furniture and fittings - Rs. 89,500/-

Desk top Computers - 62,700/-

How to compute depreciation for this?

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5 Replies

CA Harshal Totla (Chartered Accountant) (2229 Points)
Replied 13 June 2016

Aspeed schedule II of companies act,2013 depreciation is calculated on assets based on useful life of assets given in schedule.
As per schedule useful life of general furniture & fittings is 10 years and desktop computers is 3 years.
so, depreciation on furniture and fittings will be Rs.8,950p.a
and on desktop computers Rs.20,900 p.a

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jhonny (NA) (156 Points)
Replied 14 June 2016

Is it necessary to provide for 5% of cost as residual value?

CA Harshal Totla (Chartered Accountant) (2229 Points)
Replied 14 June 2016

No, it is not necessary. Use your judgement based on facts and circumstances. "Schedule II used the words" residual value in most cases is immaterial however generally it should not be more than 5% of original cost of asset".

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