Treatment of dep in accounts for deleted assets
This query is : Resolved
04 June 2012
plz explain how dep is provided for deleted/sold assets - when asset is sold in the middle of the year,is dep charged on deleted asset and then profit or loss on asset sold calculated.what r the entries from accounts point of view (and not income tax)
04 June 2012
Depreciation will be charged upto the date of sale.
Depreciation A/c Dr
To Asset A/c
Bank A/c Dr
To Asset A/c
Profit or loss will be recognised.
Asset A/c Dr
To Profit on Sale of Asset
Loss on Sale of Asset A/c Dr
To Asset A/c
Profit or loss shall be transferred to P&L Account.
Depreciation A/c Dr
To Asset A/c
Bank A/c Dr
To Asset A/c
Profit or loss will be recognised.
Asset A/c Dr
To Profit on Sale of Asset
Loss on Sale of Asset A/c Dr
To Asset A/c
Profit or loss shall be transferred to P&L Account.
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