Answer Posted / kuldip jagdish vaswani

Depreciation is an Measure of Wearing Out, Consumption and Other Loss in the Value of the Fixed Asset arising from Use Or Passage of the Time. Depreciation is an Nothing but Distribution of Total Depreciable Value of Fixed Assets over useful life of Fixed Assets. ( AS 6 - Depreciation of Indian Accounting Standards)

Depreciable Value of Fixed Assets = Total Cost of Fixed Assets Less Scrap Value

Depreciation is Been Charged for the Following Above Reasons

a) Correct Income Measurement : Depreciation should be charged fro proper estimation of Periodic Profit or Loss
b) True Financial Position : Value of the Fixed Assets should be Adjusted for Depreciation Charged in order to Depict Actual Financial Position
c) In Order to Ascertain Correct Cost of the Production
d) It Provides funds for replacement of fixed asset at the end of its useful life
and Last and Most important
As we are Following Accrual System of Accounting so Matching of Cost and Revenue comes to the picture.
So Cost of Assets matches to the Sales in the year of the Sale.

in trading credit why does goods sent on consignment come?

1968

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Trial balance as on 31st March, 2014 Particulars Debit Pula Particulars Credit Pula Wages 14 100 Dividends received 4 300 Salaries 13 000 Bank overdraft 41 000 Opening Stock 40 000 Returns 1 000 Machinery 49 000 Creditors 14 200 Investments 30 700 Sales 258 500 Drawings 23 000 Capital 30 000 Purchases 130 000 Returns 2 000 Debtors 18 000 Advertising 13 400 Interest 4 800 Cash 11 000 349 000 ======= 349 000 ======== Additional information: 1. Closing stock is valued at P53 000. 2. Wages include P350 being advance against wages. 3. Wages include P1 000 paid for erection of machinery. 4. A purchase of stationery for P430 has been inadvertently included in the Purchases account. 5. A sale of investments with a book value of P2 600 for P2 500 has been included in the Sales Account. 6. Salaries include P150 per month paid to the proprietor’s domestic servant. 7. Machinery is to be depreciated by 10 per cent. Required: a. The revenue statement (Trading and Profit and Loss Account) for the year ended 31st March 2014 and b. Statement of financial position (Balance Sheet) as on 31st March, 2014.

2085

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how to pass entry in tally Rs 50000 cheque paid to son by father

1647

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You are using the accounts approach to parallel valuation and classic assets accounting. You need to create a new financial statement version to valuation based of IFRS principles. In asset accounting, what posting options can you choose for the new depreciation area? (any 2 answer) Area post in real time Area posts APC directly and depreciation periodically Area posts APC only directly Area posts APC and depreciation periodically

1486

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Do you know what is project implementation?

976

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Time limit for payment of divident for listed limited companies & Unlisted public limited companies are? 30 or 45 or 60 or 90

2448

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how to solve cashbook question

3229

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Tell me in balance sheet, where do you show tds?

977

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What is ERP? Diff b/w Income & Expenditure a/c & P/L a/c? What is the fullform & the application of SAP? What is the reasons where Balance sheet will not tally?

2258

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Sir how the enter of GST adjust of sales return

1630

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Explain me what is assets minus liabilities?

989

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What have you read in the newspapers in the last few days that particularly interested you?

988

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we have received amount from others through debit/ credit cards. what is the ledger group of this? i am confused selecting the ledger group could you explain.

1644

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What are a debit note and credit note with an example?

1019

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how sales invoices adjusted against advance received from Debtor?

1826

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