Compensation paid on fixed assets
This query is : Resolved
Querist : Anonymous
Querist :
Anonymous
(Querist)
08 June 2012
Muncipal corporation owned some market shoping complexes while construction of flyover these complexes are removed and for these compensation received from the government.
what is the accounting treatment ?
if assets depreciation reserve maintains how to setoff it
what is the accounting treatment ?
if assets depreciation reserve maintains how to setoff it
08 June 2012
The compensation amount has to be set off against the WDV of the assets and if there is a profit or loss the same has to be recognised.
Querist : Anonymous
Querist :
Anonymous
(Querist)
08 June 2012
Thank you sir
if those assets accounting under accumulated depreciation how to set off the accounting entry
if we write off the actual asset value and can i pass entry for compensation received to the accumulated depreciation to utilize the amount for constructing in another place
if those assets accounting under accumulated depreciation how to set off the accounting entry
if we write off the actual asset value and can i pass entry for compensation received to the accumulated depreciation to utilize the amount for constructing in another place
08 June 2012
The depreciation reserve against these assets are to be reversed and transferred to revenue reserve.
Compensation- WDV of the shopping complex=profit or loss.
Depn Reserve Dr
To reserves & surplus
Compensation- WDV of the shopping complex=profit or loss.
Depn Reserve Dr
To reserves & surplus
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