Depreciation

hi, 

it should not be done in my opinion..... 

Thanks Sharad for replying.,

But you mean to say that if there is an asset at a value (say) Rs. 100/-, (say) depreciation rate is 10%,

then I should claim only Rs.10/-  as depreciation and carry forward the balance of Rs 90/-????

Ritu

An asset whose original purchase price is less than 5000/- has to bewritten off 100% in the year of purchase, and not the assets whose wdv is below 5000/-,

Again an assets whose wdv is 95% of the cost should not be written down any further.

In you case as the wdv is 5000 so it should be depreciated at the depreciation rate and not @ 100%.

Again in case of Rs. 100 if the same is of an asset whose original value was above 5000  the it should not be depreciated any further. as 5% of 5000 is Rs. 250/-.

Hope u got it.

Thanks Kumar,

Your clarification really helped me!!

Can you further clarify that if an asset has been w/off to 95% of the original value,

what is to be done about that balance 5%? Is this written off completely or it should be left to appear in the balance sheet till disposal.

Kindly give some reference which states all the above facts,if possible!

Thanks Again.

The remaining 5% swill appear in the balance sheet till disposal.

Please refer Sec 205 of companies Act