Answer / sameer nirmal

Reason 1. It's Revenue Expenditure.

Reason 2. It's charged on Fixed Assets.

Reason 3. It's Decrease Value of Fixed Assets.

Therefore it's affect on profit & loss a/c. and it's
Debited in Profit & loss A/c.

Answer / pawan kumar

it is because it is an expense to the oraganisation it is
deducted form the asset and then put in p/l a/c

Answer / rajesh

due to wear and tear of the asset, depreciation is charged
in p&l accounjt

Answer / santhosh.spike

As per accounting standards,depreciation should be charged
in p&l account.Even in Income Tax Act by virtue of
explanation (5) of section 32 of the act the depreciation
should be charged to arrive at the correct profit.

Answer / siddu

Depreciation is charged in the p& L a/c because of its is a revenue expenditure it is incurred in every financial year.

Answer / rajesh

depreciation is to be privided by the company for using the
fixed assets. the concept fixed will be retained by the
company for manufacturing goods and prividing servies for a
period more than one year. during the usage it lost its
value in the form of wear and tear efflux of time and
technical changes and latest tech development in mfg
process. once the life is over it has to be replaced by
other equipment. the basic concept is business entity
concept that the business will be carried over more than
one year. for that purpose we are charging to p&l acccount.
by charging that amount treated it as exp.with out
incurring exp we are charging thaqt means the company
holding money in the form of cash. and for purchasing new
eqipment

Answer / naresh chowdary

depreciation is debited to p&l account why because every
fixed asste lossed its value every year because of their
usage so in accounting point of you it is treated as
expence and debited to p&l account

Answer / arvind kumar tiwari(a.t)

Depreciation is the continuous decrease in the value of the
asset.Depreciation can be considered both as an expense and
as a source of revenue.

Expense:Because the value of the asset is decreased
resulting in some loss, it is posted in P&L account.

Source of revenue:Depreciation when posted on the debit side
of the P&L account, the profit is decreased. In other way,
the profits that should be distributed among the
shareholders gets decreased.It means that the residual is
placed in the business itself

Answer / yasir

as per IAS 16 property plant and equipment
depreciation is allocation of depreciable amount over its
use full life,as because we cannot charge the full amount
in the year of purchase so the depreciable amount (total
cost less residual value)is charged to income statement.

Answer / visswanathan

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