Fixed Asstets
This query is : Resolved
11 February 2009
Our Company have three mfg units.Can revaluation of F/A be done in one unit only?If Yes, what should be the accounting treatment when one asset tranferred(revalued) to the another unit.
The co is adopting SLM method.
for example: GB 100000, Accumulated dep 19000 NB 81000
Revalued Rs. 120000 and transferred to another unit
The co is adopting SLM method.
for example: GB 100000, Accumulated dep 19000 NB 81000
Revalued Rs. 120000 and transferred to another unit
19 February 2009
Dear whether there is 1 plant or 100 plant but your company is the same hence internal transfer will not have any effect on the books of account however from internal control point of view it has because cost centre wise profitability may effect receiving or transferring plant.
Hence from company's point of view entry will be
Assets a/c/ dr
To reveluation res a/c
If in this case if u trying to say that there is a holding and subsidiary relationship than the above entry shall be passed by transferring comapny in addition to:
Receiving co. a/c Dr.
To Assets account
And receiving co. will make following entry:
Asset a/c Dr.
To Trasnferring a/c
Hence from company's point of view entry will be
Assets a/c/ dr
To reveluation res a/c
If in this case if u trying to say that there is a holding and subsidiary relationship than the above entry shall be passed by transferring comapny in addition to:
Receiving co. a/c Dr.
To Assets account
And receiving co. will make following entry:
Asset a/c Dr.
To Trasnferring a/c
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