Unabsorbed epriciation and set off of losses
This query is : Resolved
15 November 2021
case 1) Normal business income 10,000
Speculative income 2,00,000
Depriciation 15,000
COI shows as 5000(10000-15000) is set off against 200000 and net income 195000 which means depri which remains unabsorbed by normal B&P can be set off against speculative
case 2) speculative income only - 2,00,000
depri - 15000
COI shows as 200000 which means that depri cannot be set off against speculative income
what is correct ?
can depri be set off against speculative income ? if no then why is it set off as in case 1
if yes then why is it not set off as in case 2
Speculative income 2,00,000
Depriciation 15,000
COI shows as 5000(10000-15000) is set off against 200000 and net income 195000 which means depri which remains unabsorbed by normal B&P can be set off against speculative
case 2) speculative income only - 2,00,000
depri - 15000
COI shows as 200000 which means that depri cannot be set off against speculative income
what is correct ?
can depri be set off against speculative income ? if no then why is it set off as in case 1
if yes then why is it not set off as in case 2
15 November 2021
Case 2 is not correct. The depreciation can be set off against speculative profit.
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