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Treatment of Car written off

223 views 5 replies

SUMIT GOYAL

43 Points Joined August 2018

If a car value is reduced from balance sheet and the car is used for personal purpose then what wiĺ be the treatment when preparing computation of income?

Replies (5)

Giridhar S Karandikar

Team Lead

7558 Points Joined November 2011

if the block ceases to exists then you need to assess the stcg/stcl.
if not then just show as a deletion from the block

SUMIT GOYAL

43 Points Joined August 2018

is the written off value to be charged to capital account or just to be reduced from balance sheet?

Giridhar S Karandikar

Team Lead

7558 Points Joined November 2011

just reduce from BS and transfer to capital account

SUMIT GOYAL

43 Points Joined August 2018

transfer to capital account? didnt get plz explain

Giridhar S Karandikar

Team Lead

7558 Points Joined November 2011

since you are selling but using the car for personal use, so while calculating profit/loss transfer the wdv of the car to capital account and by finding the market value if the car transfer the profit loss to Pand l as below

Capital Dr
to P&l
to Car

capital. Dr
p&l Dr
to car