FIXED ASSET DELETION ENTRY

Show the entry for sale in tally as

Cash/Bank A/c Dr (Agreed Value)

loss on sale A/c Dr

       To Fixed Asset A/c

Hi Ram,

In your case your company has not sold the old comps, hence in my opinion, cash / bank account will not come into the picture. Your company has just replaced the old comps for new ones.

I would suggest following accounting entry (along with one example) :-

Suppose, WDV of old 3 comps is Rs. 7,000/- ; purchase price (gross) of 8 new comps is Rs. 40,000/- ; seller agreed to deduct Rs. 6,000/- from selling price on exchange ; hence, company has paid only Rs. 34,000/- (after deducting Rs. 6,000/-)

Now, the entry would be :-

Computer A/c. ........................ Debit       40,000/-

                  To Computer A/c. (old)                        6,000/-

                  To Bank Account                                34,000/-

Now the balance in Old Comp account will be Rs. 1,000/-. Just write off that amount to P&L A/c.

Entry would be :-

P & L A/c. .............................. Debit                     1,000/-

                To Computer (old) A/c.                                     1,000/-

ALL THIS IS WHAT I THINK, OTHER VIEWS ARE WELCOME.

Yes, i agreed with Yogesh Shah

Originally posted by : Yogesh Shah
	Hi Ram,   In your case your company has not sold the old comps, hence in my opinion, cash / bank account will not come into the picture. Your company has just replaced the old comps for new ones.   I would suggest following accounting entry (along with one example) :- Suppose, WDV of old 3 comps is Rs. 7,000/- ; purchase price (gross) of 8 new comps is Rs. 40,000/- ; seller agreed to deduct Rs. 6,000/- from selling price on exchange ; hence, company has paid only Rs. 34,000/- (after deducting Rs. 6,000/-) Now, the entry would be :- Computer A/c. ........................ Debit       40,000/-                   To Computer A/c. (old)                        6,000/-                   To Bank Account                                34,000/-   Now the balance in Old Comp account will be Rs. 1,000/-. Just write off that amount to P&L A/c. Entry would be :- P & L A/c. .............................. Debit                     1,000/-                 To Computer (old) A/c.                                     1,000/-   ALL THIS IS WHAT I THINK, OTHER VIEWS ARE WELCOME.

Agree!!

I agree with Yogesh Shah but there is minor mistake " purchase price (gross) of 8 new comps is Rs. 40,000/- . There should be 5 new comps in place of 8 new comps  mentioned.

HI Shailendra,

In my example, what I have said is - suppose Company has purchased 8 new comps but price of them is proportionately reduced by value of old 3 comps.

Now if you account for only 5 comps then Fixed Asset A/c. will not look proper and true. I have debited Fixed Asset by GROSS value of all new 8 comps. Value of 3 old comps is credited in my example. Ultimate effect is same but IT REFLECTS MORE PROPER & TRUE PICTURE.