Depreciation

Depreciation here should be claimed on block basis here and the total value of the block can be aggregated to arrive at the final depreciable value..

add the value of first car, subtract the value of sale and add the car purchased again, and then charge the depreciation , this is called as block calculation.

Originally posted by : Jay Prakash Mishra
	In 15% block there is a car with Opening Balance of Rs.430451/- and the same was sold in Rs350000/-  and a new car is purchase on 18-12-2011 worth Rs.884209/- how to compute depreciation in this case ? Point to be explianed- 1) Can  depreciation can be claimed for Old Car and if not why?

Closing balance=[(430451-350000)+884209]=964660.

Of the above:

Depreciation @ 7.5%(since used for less than 180 days)=884209*7.5%=66315

Depreciation @ 15%=(964660-884209)*15%=12067

Total Depreciation=78382

Closing WDV=964660-78382=886278

Regards,

RA

Dear 

Jay Prakash Mishra,

Kindly find the file attached which will give you an idea of depreciation calculation

Regards,

BisHwaJeet

Could some one explain why in this case it should be block Depreciation. the old car can be written off and the differnce can be transfered to P&L, loss or gain on sale of FA. and new car be brought in FA register.

Prasad under IT Act assets are classified into Block of Assets and computation is done as follws

Opening Balance

Add:Purchases

Less:Sales

Closing Balance

Less:Depreciation

Closing WDV

Prasad under IT Act assets are classified into Block of Assets and computation is done as follws

Opening Balance

Add:Purchases

Less:Sales

Closing Balance

Less:Depreciation

Closing WDV