Hellow Friends,
Im doing Audit of Proprietory Firm, there is one HMV truck at openning wdv 346597/- which is sold at 300000/- in august 2010 at loss so depreciation on sale is allowable, and another HMV truck purchased in feb 2011.the accountant showed dep on that rs.25000 (apprx)and loss on sale of assets rs.20600 (apprx) whether it is right Accounting Entry???? plz reply
HI, in my opinion you should first calculate the depreciation upto august on truck that wil be the WDV to be taken into consideration for the purpose of calculation of profit or loss on sale , for eg: it is 330000 and it is sold for 300000 then Rs 30000 will be charged to profit and loss account .
whether it is allowable to cliam depreciation on sale of assets????????
Saini Pati Shah & Co LLP, Chartered Accountants
Mumbai
CA Foundation
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Naveen Fintech Pvt Ltd
Kolkata
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Anupam Parashar & Co.
Ghaziabad
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