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Depriciation entry in tally

23 April 2021

Dear all, kindly guide me how to book depriciation entry of FA purchased from donor funding. For example :- 1) FA account dr. Bank cr. 2) depriciation ac Dr. FA account cr. 3) Capital fund ac Dr. FA fund (capital Account).

Now, problem in there that if I dr. FA fund ac then which account should be credited. For correct entry.

Kindly let me know your suggestion

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11 Replies

yasaswi gomes (My grammar is 💯 good I) (7290 Points)
Replied 24 April 2021

2 one is correct.

prasad Nilugal (3914 Points)
Replied 24 April 2021

Depreciation A/c Dr
To Fixed Asset A/c Cr
(Being Depreciation for the period charged )

1 Like

CA. Sourav Sarkar (Chartered Accountant ) (24578 Points)
Replied 24 April 2021

Fixed assets a/c dr
to Bank a/c

Depreciation a/c dr
To Fixed asset a/c

P/L a/c dr
To Depreciation a/c

1 Like

sabyasachi mukherjee (26158 Points)
Replied 24 April 2021

Please pass narration.
First is purchase of fixed asset.
Second is a wrong entry.
Third is wrong.

CA. Sourav Sarkar (Chartered Accountant ) (24578 Points)
Replied 24 April 2021

Why 2nd and 3rd entry is wrong??? Its Depreciation entry please check the entry again

sabyasachi mukherjee (26158 Points)
Replied 24 April 2021

First you hv to provide for depreciation .
Then you can pass this entry.

1 Like

CA. Sourav Sarkar (Chartered Accountant ) (24578 Points)
Replied 24 April 2021

Firstly, Fixed assets purchased should be passed then depreciation entry should be passed

sabyasachi mukherjee (26158 Points)
Replied 25 April 2021

Provide for depreciation. You cannot book any expense unless it is provided for.

First know the basics.

1 Like

CA. Sourav Sarkar (Chartered Accountant ) (24578 Points)
Replied 25 April 2021

Please check the Entry then

yasaswi gomes (My grammar is 💯 good I) (7290 Points)
Replied 25 April 2021

@ Saurav hi, I was shocked but it is the truth. I dont rememberer learning provision for depreciation. It is completely AS where an actual provision is created. I’m surprised as well because, I haven’t seen Provision for it in my financial statement analysis nor IndAS/ IFRS Reporting books and slightly got misguided. I started writing here to someone saying there is No provision for depreciation and finally I got this concept here. It’s easy: https://www.tallyschool.com/depreciation-entry-in-tally/