Answer Posted / h.r. sreepada bhagi
Depreciation is charged on fixed assets to account the
reduction in their value due to use, passage of time,
obsolescence, etc. Assumption (Fact also) is that after some
years the assets will become useless & they will not be
useful for the business.
Contrary to this land will never cease to exist. it remains
there forever and remain useful. It's value will not
generally come down. Hence it's not depreciated and usually
shown at cost of acquisition. However, if a business wants
to revalue it, it can do so & state it at the market value
as per the provisions of applicable laws.
Remember - Land is an asset with perennial value & its life
is not limited as that of other fixed assets (For which
depreciation is necessary)
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