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Arundhati Raychaudhuri (no designation)     08 June 2011

loss on sale of fixed assets

is the loss on sale of fixed assets a capital loss/revenue loss? other than p/l whereelse we can chrg it?



 8 Replies

U S Sharma

U S Sharma (glidor@gmail.com)     08 June 2011

fixed assets where depriciation is availed, any loss at the time of sale when its less than wdv, can be reflected in P/L account

fixed assets where depriciation is not availed, ( personal effects) no such provision to claim loss, it would be capital loss.

1 Like
Arundhati Raychaudhuri

Arundhati Raychaudhuri (no designation)     08 June 2011

how to show capital loss in d balance sheet? will i debit goodwill account?

MANOJ SHRIPATI

MANOJ SHRIPATI (CA FINAL)     08 June 2011

AS PER A.S 10........

LOSS ARISING OUT FROM SALE OF FIXED ASSETS SHOULD BE RECOGNISED IN THE STATEMENT OF PROFIT AND LOSS A/C...AND HENCE IT IS REVENUE LOSS...

BIFIRCATION IS NECESSARY ONLY IN CASE OF PROFIT......

IF SELLING PRISE IS MORE THAN ORIGINAL COST THE DIFFERENCE BETWEEN O.C AND S.P WILL BE TREATED AS CAPITAL PROFIT AND WILL BE TRANSFERD TO CAPITAL RESERVE....

nikhil

nikhil ((CA Final) Article)     09 June 2011

If u have showed your fixed asset in balance sheet that means u have capitalise that and deduct deprication on yearly bases....so deduct deprication of all year from the cost of fixed asset i.e Selling price - (Fixed assets - deprication of all year on that particular fixed asset) this way u will calculate gain or loss If there is loss on fixed it will be shown in dr side and if profit then in credit side of p/l It will be revenue loss ....
sameeksha

sameeksha (student)     10 June 2011

As per AS-10 '' Accounting for Fixed Assets"

In case of previously revalued fixed asset- if there is loss on sale, then it can be adjusted against the balance of revaluation reserve(revaluation of same asset) if any and the balance is debited to P&L A/c.  

In case of other fixed assets- charged to P&L A/c.

As per AS-5" Net profit or loss for the period, prior period items, and change in Accounting policies"

Loss on sale of fixed asset is an ordinary activity. The nature and amount of such item should be SEPARATELY disclosed in P&L A/c.

Aparna Raja K.C

Aparna Raja K.C (Student)     10 June 2011

Debit the loss on account of sale of Fixed asset in P&L....

Generally Capital loss is not taken to balancesheet :)

<i have never come accross such a treatment>

it is adjusted with profit:)

rakeshkuma

rakeshkuma (B.COM CA FINAL)     15 June 2011

AS 10 clearly speltout that loss or profit on sale of fixed asset should be recognised in P&L account.

and as manoj said. profit on sale of fixed asset over and above  depriciation written off on that asset should transfer to genaral reserve

Neethi V. Kannanth

Neethi V. Kannanth (.)     20 January 2021

When should the profit or loss on sale of fixed asset be recognized if maintaining several assets in the same block?


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