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depriciation

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(Querist)
04 July 2007 my client,s business is related to software and they do follow a wdv method of depriciation...
if i calculate depriciation at 40% as per companoes act for computers and software the asset value is negative...
is it put as a scrap or what am i to do...
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Amit Thapar

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Amit Thapar (Expert)
04 July 2007 I am surprised. If you get an answer plz let me know
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Shyam Lal Naik

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Shyam Lal Naik (Expert)
04 July 2007 Hi,

If one calculate depreciation under the Written Down Value(WDV) Method, irrespective of rate of depreciation, the asset value(i.e. Net Block) can not be negative. At best the Net Block will get reduced to zero. The question of scraping etc. of the assets does not arise in this case.

The depreciation rate is to be applied on the amount of Net Block as on the beginning of the year, subject how ever to addition/delation of assets during the year.

You are requested to re check your calculation.
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Shyam Lal Naik

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Shyam Lal Naik (Expert)
04 July 2007 Hope, the question stands resolved.
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Shaily Jain

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Shaily Jain (Expert)
04 July 2007 You need to recheck the calcluation.......bcoz it can never in negative
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CA BHARATH KUMAR

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CA BHARATH KUMAR (Expert)
04 August 2012 yes you can folow recheck once the calculation
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CA BHARATH KUMAR

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CA BHARATH KUMAR (Expert)
04 August 2012 yes you can folow recheck once the calculation
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