Depreciation on assets under companies act

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

14 June 2012 Hi...

My self Tarun Yadav,working as a manager accounts in FCI.while preparing schedule of assets, i have came across the below queries on the subjected matter..thus seeking your kind guidance...

1. Should i charge depreciation on the assets sold in the current F.Y. and if yes then should i charge it for upto the month of sale?

2. How should i charge depreciation on the assets installed after 15th of a month...ex: for the assets installed on 30th march 2012.

Thanks and Regards
Tarun Yadav

CA Siddhartha Bhardwaj

CA Siddhartha Bhardwaj (Expert)
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14 June 2012 Depreciation under Companies Act is charged on the basis of number of days.

In case of sale of an asset, depreciation shall be calculated from 1st April to date of sale.

In case of acquisition, depreciation shall be calculated from date of acquisition to 31st March.

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Bhaskaran Chackrapani Warrier

Bhaskaran Chackrapani Warrier (Expert)
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14 June 2012 1. Charge depreciation up to the date of sale.
2. Provide 2 days depreciation presuming accounts are closed on 31/03/2012.

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Querist : Anonymous

Querist : Anonymous (Querist)

14 June 2012 Sirs,
Thanks for the prompt reply...but still i have a confusion that ...

1. for the assets installed before 15th of a month should i charge a full month's dep?
For Example:

date of installation is 14th Jan 2012 so dep would be:
(value of asset*rate of dep)
__________________________ * 3 months
12*100

2. For the assets installed after 15th of the month, should i charge dep for the half of the same month.

For example:
date of installation is 20th jan 2012 so dep value would be:

value of asset * rate of dep

_____________________________ * 2.5 months
12*100

Kindly clarify.

CA Siddhartha Bhardwaj

CA Siddhartha Bhardwaj (Expert)
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14 June 2012 As I said, calculate depreciation on the basis of NUMBER OF DAYS.

First Calculate the number of days
Then calculate the depreciation.

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