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Examples for fictitious assets?????????????????????

CWA learner


 

                                                          shareholder's fund

Net worth ratio                      =    -------------------------------

                                                     total aseets excluding ficticious assets

 

Whaat are fictitious assets. pls give me the examples for that.     

                                                         

                                                       

 
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like preliminary expenses not written off, discount on issue of debentures not written off.


Total thanks : 1 times

 
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CWA learner


thq Mr. Ashish

 
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We shown some asset under the head "MISC. EXPENDITURE (to the extent not written off)  in the balance sheet on asset side however that does not have any value ....called fictitious Assets. Example are same as pointed out by Mr Ashish.

 

Regards

Arun

 
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b.com 1st year


can you explain what does 'written off' exactly mean??

i have always heard written off but no one explained what it means.

 
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written off means writing off the value of assets in P&L A/c. i.e. Debiting the P&L and crediting the assets.

 
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CA FINAL(May 2014) ARTICLED STUDENT

Fictitious assets are those assets which are not tangible in nature & has no value. They are not taken over in the process of M & A. They are loss assets. They are shown on the assets side as they show debit balance. They are like preliminary expenses, P& L a/c (loss) & discount on issue of shares.

 
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CWA learner


 

Thank u Mr. Phalgun. Well again a doubt is raised in my mind. according to ur explanation "Fictitious assets are those assets which are not tangible in nature & has no value." is............. intangible assets and fictitious assets are same?

 
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CA FINAL(May 2014) ARTICLED STUDENT

Intangible assets & Fictious assets are not one & the same. Intangible assets have value eg like Good will, Copy Rights, patents ....etc. Fictitious assets have no value. Intangible assets worth are taken over in the event of M & A. In the event of internal reconstruction same is written off. AS 26 deals with intangible assets.

 
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what is M&A?

 

 
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