cost soncept extenstion of Going Concern?

Save Share

This query is : Resolved

A J Sankar (Querist)

23 October 2008 I have read a question where it has been asked that "How is Cost concept extension of Going concern"

Please clarify it.

KAAPIL

KAAPIL (Expert)

23 October 2008 YOU ARE BUYING MACHINE. YOU SPEND RS.10000. THIS IS COST. MACHINE WILL HELP YOU FOR PRODUCTION. THIS IS CONCEPT OF ECONOMIC ACTIVITY. IT GIVES YOU PROFIT. HERE YOU WILL PREPARE P&L WHERE YOU WILL CHARGE DEPRECIATION. THEN ARRIVE AT NET PROFIT. THIS WILL BE CONTINUED ONLY IF YOU HAVE AVOIDED RED. I AM SORRY FOR SHORT EXPLANATION. AS THIS CAN GO ON FOR 10 PAGES.

A J Sankar

A J Sankar (Querist)

24 October 2008 I am sorry I dont understand it? please clarify it once again.
or Any one can help to make me clear

S.Srinivasaraghavan

S.Srinivasaraghavan (Expert)

30 October 2008 To value an asset on Going concern concept is to value the asset as it is being used in normal business operation. That is not looking at it in isolation of the functuion it is used for. This will fetch the true value for the asset on the basis of its real useability.

A J Sankar

A J Sankar (Querist)

05 November 2008 thank u sir

You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now