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Why don't calculate the depreciation on Land & Devlopment.?
Explain.
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Answer / h.r. sreepada bhagi
Depreciation is charged on the long term tangible assets
(Fixed Assets), over the period of it's useful life, due to
limited life and the value of the asset will come down due
to usage, effluction of time, obsolescence, etc. Since the
benefit of using these assets is spread over several years
the cost is also reasonably apportioned to more than one
accounting period.
This assumption is true in case of all assets except land.
Generally, the life of land is not limited (it's eternal or
perpetual)and it's value is not expected to come down &
hence as a general rule depreciation is not allowed on land.
| Is This Answer Correct ? | 3 Yes | 0 No |
Answer / ronit
well depreciation is charged on usage of machinery and n assets as their usage and if we talk about depreciation on land we find rarely chances of low value of land because land value always increases with development
| Is This Answer Correct ? | 3 Yes | 0 No |
Answer / atul
As per me when we calculate the depreciation on land its
depand on location of land because as per rule we have not
charge the depreciation on Land & building at that time
their is no change in land area but if our land area is
locate near of rever or sea and due to change in water
level of rever or sea then our land area goes down so that
time we will charge the depreciation on Land & Building.
| Is This Answer Correct ? | 2 Yes | 3 No |
Answer / sunil jadhav
As we calculate depreciation as the vlaue of fixed assets
goes down due to time factor but the value of Land dont
goes down
| Is This Answer Correct ? | 1 Yes | 3 No |
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