Accumaleted depereciation

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SIJU KURIYAN

SIJU KURIYAN (Querist)
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09 March 2012 dear sir
i wanted to know about accumaleted depereciation ,entry,applicability

CA Siddhartha Bhardwaj

CA Siddhartha Bhardwaj (Expert)
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09 March 2012 Depreciation A/c Dr
To Accumulated Depreciation

P&L A/c Dr
To Depreciation

Accumulated depreciation is shown as a deduction from Fixed Assets.

Every year same entries are passed and the balance in the accumulated depreciation keeps on increasing.

In the year in which the asset is sold, entry will be:

Sale of Asset A/c Dr.
To Fixed Assets

Accumulated Depreciation A/c Dr
To Sale of Asset A/c

Bank A/c Dr.
To Sale of Asset A/c

Sale of Asset Dr
To P&L
(In case of profit)

P&L Dr.
To Sale of Asset
(In case of loss)

SIJU KURIYAN

SIJU KURIYAN (Querist)
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10 March 2012 dear sir
i have a doubt regarding accumalated depreciation

1. any changes in the value of asset,while providing these depreciation.?

2.any changes in the value of balnce sheet/trail balnce (increse/decrese)

3. undedr of accumaleted depreciation ?

4. under of depreciation ? (while providing accumalated depreciation)

kindly reply at the earliest

CA Siddhartha Bhardwaj

CA Siddhartha Bhardwaj (Expert)
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10 March 2012 1. By following the accumulated deprciation method, the asset is shown at its historical cost, i.e., the cost at which it was purchased.

The presentation in the Balance Sheet is as under:

Fixed Assets
Less: Accumulated Depreciation

There is no change in the value of asset.

2. Impact on Balance Sheet/Trial Balance
Increase in value of accumulated depreciation and booking depreciation as an expense.

Unable to understand queries 3 & 4.

SIJU KURIYAN

SIJU KURIYAN (Querist)
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10 March 2012 sir

eg capital 5000 asset 5000

CA Siddhartha Bhardwaj

CA Siddhartha Bhardwaj (Expert)
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11 March 2012 What do you want to ask in queries 3 & 4? The language is not clear. Kindly re frame the queries.

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