HOW TO PREPARE BOOKS OF ACCOUNT

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kausar alam (Querist)
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22 October 2010 HOW TO PREPARE BOOKS OF ACCOUNT FOR PROPRIETOR

FOR EXAMPLE -

MACHINERY A- RS. 15000

MACHINERY B- RS. 10000

MACHINERY C- RS. 5000

TOTAL RS. 30000

IF ASSETS A IS SOLD FOR RS 35000. THEN ASSETS WILL BE SOLD IN BALANCE SHEET

CA KISHORE VANAMA

CA KISHORE VANAMA (Expert)
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22 October 2010 There is no specific method for preparing accounts of Proprietor,even though we will calculate depreciation and follow the method as specified in income Tax Act

CA Shailesh Kumar Bhagat

CA Shailesh Kumar Bhagat (Expert)
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23 October 2010 Assets in balance sheet RS. 15000

Profit on sale of assets is RS. 20000

sivasankar

sivasankar (Expert)
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23 October 2010 Sir,
Keep separate ledger accounts for the three machines.If A is sold fully for a profit transfer the profit to P and L a/c as income and the other two machines will continue to be in the balance sheet.

kausar alam

kausar alam (Querist)
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23 October 2010
Keep separate ledger accounts for the three machines.If A is sold fully for a profit transfer the profit to P and L a/c as income and the other two machines will continue to be in the balance sheet.

but dear what about the block assets concept

sivasankar

sivasankar (Expert)
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23 October 2010 My Dear,
Your query was regarding the accounting entries so only Tax angle was untouched.

If you want the answer in IT view point,
the other two assets will be in the books as mentioned earlier and the Block of assets concept is only for IT purpose. You need not pay capital gain tax since your balance of the block becomes nil.
regards
sivasankar
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