Dep. as per IT & Companies Act

Kumar Gaurav (Going...to be C.A soon...)   (1624 Points)

03 July 2010  

Dear All

As we know we will charge depreciation in books as per companies act and also as per income tax act!

Pl. suggest me on the following example

Assets name say computer (dep rate say 60% as per companies act) & (dep rate say 40% as per income tax act)

Assets WDV say Rs. 50,000/-

if we booked dep. on 31st march' 2010: depreciation a/c Dr. 30K

Assets Cr. 30K

now assets balance ladger would remain by Rs. 20Kb

but income tax dept. will allow only Rs. 20k as depreciation claim then what is the accounting entry for Rs. 30k-20k=10k??

Thanks!