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depreciation

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executie
185 Points Posted on 08 August 2018
after depreciation asset value reduced and posted to PL accounts and reduce profits
but in actual it not affect cash balance
depreciation amount can be added to cash balance ?
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On 08 August 2018 at 16:41 Report
Replies (10)
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Consultant
606 Points Posted on 08 August 2018
Depreciation is a non-cash expenditure. Cash balance will not be affected by depreciation
3 Reply
On 08 August 2018 at 16:56
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"Do the Right Thing...!!!"
128147 Points Posted on 08 August 2018
No... Depreciation is applied in Fixed Assets value. The Asset value reduced as Depreciation and It's transferred to PandL Account ...

Cash Ledger is not involved in this Transaction.
463 Reply
On 08 August 2018 at 17:22
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executie
185 Points Posted on 08 August 2018
my confusion is supose 200000 profit before changing dep after depreciation profit 180000 but my cash remain 200000
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On 08 August 2018 at 17:40
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Consultant
606 Points Posted on 08 August 2018
Yes...cash balance will remain unchanged.
Depreciation is affected in P&L account and Fixed asset account. Profit is reduced in P&L account and also depreciation is deducted from Fixed asset balance.
There is no need to alter cash balance
3 Reply
On 08 August 2018 at 17:44
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executie
185 Points Posted on 08 August 2018
thanks to all for reply and information
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On 08 August 2018 at 17:46
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128147 Points Posted on 08 August 2018
Yeah... Depreciation and It's value not affected in Cash Ledger...


Also You ll see Your book entry of Depreciation. It's as

Dr. Depreciation A/c - Rs. XXX
Cr. Fixed Asset A/c - Rs. XXX

See the entry it's from Fixed Asset value to Depreciation Value...
463 Reply
On 08 August 2018 at 18:28
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executie
185 Points Posted on 08 August 2018
i am showing cash balance in balacesheet is 11 of my capital
any limitation on showing cash balance in balance sheet
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On 08 August 2018 at 18:33
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128147 Points Posted on 08 August 2018
Capital...???

No more limits for showing cash balance except Negative Figure...
463 Reply
On 08 August 2018 at 18:36
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executie
185 Points Posted on 08 August 2018
27 lakh capital in laiblity side and 3 lakh cash remainning asset
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On 08 August 2018 at 18:38
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128147 Points Posted on 08 August 2018
No more clarity for Your query...
463 Reply
On 08 August 2018 at 18:39


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