Basic query in accounting
This query is : Resolved
07 October 2013
Whether below Statement is correct?
In case of Hire purchase transaction, possession of goods is with Buyer,Ownership is with Seller and risk & reward is associated with ownership is also with seller Hence Vendor must Depreciate the asset ,i think because substance over form will not applicable and also economic substance is not about possession and/or use, its about the risks and rewards.
I will be very much thankful to you.
In case of Hire purchase transaction, possession of goods is with Buyer,Ownership is with Seller and risk & reward is associated with ownership is also with seller Hence Vendor must Depreciate the asset ,i think because substance over form will not applicable and also economic substance is not about possession and/or use, its about the risks and rewards.
I will be very much thankful to you.
07 October 2013
Under a hire purchase contract,
the buyer is leasing the goods and does not
obtain ownership until the full amount of the
contract is paid.
the buyer is leasing the goods and does not
obtain ownership until the full amount of the
contract is paid.
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