a person who is doing business of computers with a perticular firm name (which is propritor firm) since he has change his business from computer to construction with a new firm name now he want to take his assets which was in the existing firm , transfer in the new firm which is construction firm so what is the implification in this regard like what is the entry of stock , cash, immovable property etc,
Close the books of existing firm by crediting all Assets a/c and respective debit to his capital A/c.
and pass the opening entry in new firms books
( I suggest the amount taken here should be NRV)
Close the books of existing firm by crediting all Assets a/c and respective debit to his capital A/c.
and pass the opening entry in new firms books
( I suggest the amount taken here should be NRV)
madhusudan can u tell me in case of immovable property there is transfer ???, if your answer is yes then would it liable to capital gain and also pay stamp duty since property is transfer
No it will not attract capital gain as it is a case of propriter business and in incometax propriter business is assessed in hands of individual. Also it is not a transfer in actual it is merely a book entry and there is no consideration as such.
Regards
Madhusudan
CAclubindia
