Depreciation

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pvsrikanth (Querist)
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24 August 2011 DEAR SIR,

CAN YOU PLEASE TELL ME HOW TO CALCULATE DEPRECIATION ON FIXED ASSETS. DEPRECIATION HAS TO CALCULATE ACCORDING TO COMPANIES ACT OR INCOME TAX ACT. IN AUDITORS FINAL BALANCE WHICH DEPRECIATION TABLE HAS TO SHOW COMPANIES ACT OR INCOME TAX ACT.

FOR EXAMPLE I PURCHASED CAR FOR RS.10,00,000 IN THE YEAR 2006 IST JULY. I SOLD ON 13TH FEB 2011. HOW TO CALCULATE DEPRECIATION BETWEEN THESE PERIOD. IF CAR TAKEN ON LOAN IS THERE ANY CHANGE IN CALCULATION OF DEPRECIATION. KINDLY GIVE SOLUTION.

CMA Ramesh Krishnan

CMA Ramesh Krishnan (Expert)
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24 August 2011 As per books need to be provided companies act depreciation ( Rates prescribed in companies act is minimum rate, you can charge rate more than that also)

Income tax depreciation need to be apply for income tax calculation purpose, no need to pass book entries

For financials you need to give assets schedule & depreciation as per companies act

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