Depreciation

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Heman Chheda (Querist)
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20 January 2010 There 200 chairs purchased for Rs.500 each.on 1/10/2009. What would be the Depreciation for the December Quarter? As per Cos Act an asset amounting less than 5000/- should be charged with 100% Depreciation. Will the chairs qualify for 100% Depreciation? What will be amount of Depreciation?

CA Prashant Gupta

CA Prashant Gupta (Expert)
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20 January 2010 As per Co. Act the rate of Dep should be 100%. Because a chair doesn't cost more than 5,000/-.
Dep will be 4562.19 i.e. 100000x(92/365) x 18.1%

Heman Chheda

Heman Chheda (Querist)
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20 January 2010 But depreciation would be 100% than why 18.1%.

Gayathri Devi

Gayathri Devi (Expert)
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20 January 2010 Dear Heman

The total cost of the asset is Rs.100000/-(200*500) so you want to claim the depriciation for Rs.100000/- i.e the total value of the Chair
You should not consider the amount of Depriciation only the cost of the Asset hence you want to claim the depriciation on Rs.100000/- for chair.

Heman Chheda

Heman Chheda (Querist)
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20 January 2010 Thanx mam for ur reply but my querry stands unresolved that wat shud i do. Charge 100% Depn or 18.1%?

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