AS-10: Property, plant & equipment

Jitendra Kumar

When exchange has commercial substance, PPE is recorded at the fair value of asset given. If such value is not reliable then consider fair value of asset received. If both fair value is not reliable then use book value of Asset given. Since fair value is not given. Record land at book value. Excess will go into P&L. Journal entry will be Cash Dr. 20 L Plant and machinery A/c Dr. 25 L To p&l. 35L To Land 10L

Thread Starter

So land valued at 5 lakhs is wrong?

Jitendra Kumar

Yes bro,it should be 10 lakhs