Purchase of machinery
This query is : Resolved
12 December 2014
One of my Clint purchased a machinery. the cost of machinery is 175000+taxes that is actual but the committee had dissed the cost of old machinery WDV is 20000 . when the company purchased new the cost of old machinery deducted from the cost of new machinery before vat calculation
cost of machinery is 175000
old machinery is 20000
total cost of new machine 155000
vat 14.5% 22475
total cost 177475
whether it is correct or not
cost of machinery is 175000
old machinery is 20000
total cost of new machine 155000
vat 14.5% 22475
total cost 177475
whether it is correct or not
CA R SEETHARAMAN
(Expert)
12 December 2014
It is not correct. Both are separate transactions. Vat should be calculated on 175000.
New machinery has to be capitalized at 175000 plus vat. Old machinery wdv has to adjusted with 20000.
New machinery has to be capitalized at 175000 plus vat. Old machinery wdv has to adjusted with 20000.
12 December 2014
agreed with the above reply.................
Rupesh Jain
(Expert)
15 December 2014
YOU HAVE TO TAKE BOTH MACHINERY AS SEPERATE ITEM AND THEN CALCULATE THE VAT.
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