MyQuestionIcon

1

You visited us 1 times! Enjoying our articles? Unlock Full Access!

Depreciation

A company pur...

Question

A company purchased a land in an urban area. It does not provide any depreciation on the purchased land at the end of the year. Is the company correct in doing so ?

Open in App

Solution

Yes, land is not a depreciable assets because its useful life is not limited to few years, rather its value increases with the passage of time.

Suggest Corrections

thumbs-up

0

Similar questions

Q. On 1st April, 2015, a limited company purchased a Machine for ₹ 1,90,000 and spent ₹ 10,000 on its installation. At the date of purchase, it was estimated that the scrap value of the machine would be ₹ 50,000 at the end of sixth year.
Give Machine Account and Depreciation A/c in the books of the Company for 4 years after providing depreciation by Fixed Instalment Method. The books are closed on 31st March every year.

Q. On 1st April, 2007, a limited company purchased a Machine for ₹ 1,90,000 and spent ₹ 10,000 on its installation. At the date of purchase, it was estimated that the scrap value of the machine would be ₹ 50,000 at the end of sixth year.
Give Machine Account and Depreciation A/c in the books of the Company for 4 years after providing depreciation by Fixed Installment Method. The books are closed on 31st March every year.

Q. From the following details calculate the Land & Building purchased during the year -
Land & Building on 1.4.2018 = 2,00,000
Land & Building on 313.2019 = 2,13,750
Depreciation provided on land & building during the year was Rs. 11,250.

Q. Mr. Rahul purchased land worth Rs. 1,00,000 in the name of his company. This is a/andecision.

Q. A company purchased a machinery for ₹ 50,000 on 1st October, 2015. Another machinery costing ₹10,000 was purchased on 1st December, 2016. On 31st March, 2018, the machinery purchased in 2015 was sold at a loss of ₹ 5,000. The company charges depreciation @ 15% p.a. on Diminishing Balance Method. Accounts are closed on 31st March every year. Prepare the Machinery Account for 3 years.

View More

Join BYJU'S Learning Program

similar_icon

Related Videos

lock

ACCOUNTANCY

Watch in App

explore_more_icon

Explore more

Standard XI Accountancy

Join BYJU'S Learning Program

CrossIcon