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Questions based on as

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chris

133 Points Posted on 02 March 2013

Please answer my questions based on AS.

1) A special asset has been constructed for 150000.
This asset has no sale value as it is project specific.
Project was expected to be completed by the end of yr.3.
However, project was completed in yr2.

Depreciation in yr1 = 150000/3 yrs = 50000.
can the bal. of 1L be charged as depreciation in year '2'

in the books of the Contractor?

2)Can a different dep policy followed for each yr. for the same asset.
say
yr 1 SLM
yr2 WDV
yr3 SLM

3)If an asset was acquired in March 2012, then in the Financial Year 2011-12
can the depreciation be charged for 6 months? Which AS is to be followed?

Replies (1)

CA Saroj Kumar

Keen to learn something new every moment

2160 Points Posted on 03 March 2013

1.0 - As per given details it pertains that in previous year the company have SLM policy for depreciation and expected useful life of year but due to completion of prior to the expected...hence it advisable that the remaining depreciation can be charged over remaining life. 2. there is no requirement of change in method of depreciation and also as per accounting concept you have to follow consistency approach over the accounting policy. 3.0- Yes depreciation will be charged for 6 months even if there is one day before the same has been purchased the same will be shown in Balance Sheet subject to charging of depreciation. All these matters pertains from Accounting Standard- 6" Accounting for Depreciation" Hope ur queries may get solved.