Machinery amount for charging depreciation?

This query is : Resolved

pritamsurekar@gmail.com (Querist)
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12 December 2012 Dear Sir,

If Machinery Purchase bill have excise duty & Vat also, We taken credit for both. then what will be the amount taken for charging Depreciation?

Eg. 100+12.36+12.5=124.86

Kindly explain in detail with excise duty & VAT also?

CA Dileep Surya Kumar

CA Dileep Surya Kumar (Expert)
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13 December 2012 Deduct the amount of input credit taken for both excise and vat , charge depreciation on the balance value i,e 100.

CA Roshan Jha

CA Roshan Jha (Expert)
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13 December 2012 If you have taken credit, that means you have not capitalised the Excise duty and Vat. Therefore your book also explains the same. Hence claim depreciation on the amount excluding Excise duty and vat i.e Rs. 100 in your example.