Fixed asset accounting
This query is : Resolved
Querist : Anonymous
Querist :
Anonymous
(Querist)
10 April 2016
What if fixed asset is received free of cost by say, a partnership firm and accounting standards are applicable to it.
How would be this transaction accounted..?
10 April 2016
You have to book the fixed asset market value as on the date of received, debit fixed asset and credit to reserve account under capital
10 April 2016
we cannot book it as nominal value say Rs.100 as debiting Asset and crediting the capital reserve as per AS 12.?
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11 April 2016
No.,actually you have to book the market value, it is also required incase you claiming depreciation on that assets i, books
11 April 2016
OK but can we claim depreciation on market value ?
As per sec 43(1) of IT act,1961
11 April 2016
depreciation can be claim only on actual cost of acquisition of asset..
11 April 2016
The asset received free of cost need to book the fair market value as on the date which received and the credit the reserve account and depreciate the same with debiting the reserve account over the useful life of the asset
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