as 12

answered on 27-Jan-25 23:49

sir iam confused you said for non depreciable asset we transfer the grant to capital reserve but in the end u said it can also be deducted from such assets cost and also sir for an free asset u said we need to give some nominal price and u can credit any unsensitive accounts right so is there any other possible accounts i can use it for this purpose other than depreciation

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ok sir so i would just go with capital reserve way then thanks sir doubt cleared

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as 12

answered on 28-Jan-25 00:00

sir in this video weve seen that if a non depreciable asset is acquired and for the grant is given and ther eis no future condition is met then transfer it to capital reserve but if there is any future conditions to be met then name it as deferred gov. grant and charge it to p and l in proportion to the future expenses of that condition lets say the land is 1cr and grant is 30l and future condition to be done for 1 year and the cost would be 10l .so here there is a future condition and the asset is non depreciable since it is freehold land so we charge the grant according the proportion of the money incurred but here it is only 10l so do we transfer 20l to capital reserve and charge the 10l to p and l in proportion which is here at one shot since its only 1 year and we incurred the expense of 10l at that 1year

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sorry sir i didnt stated for non depreciable asset that grant can also be reduced from the asset but rest i stated the same things you stated sir. thanks sir my doubt is clarified

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answered on 28-Jan-25 00:02

doubt is in illustration 11 sir what if the asset is depreciated not by its useful life rather by units like number of km or units produced or usage like jets which are usually have certain rules saying that this model would safely reach 1l km after that using it is on ur risk and in airlines and all if they used such amount of km they mostly dispose or overhaul the whole aircraft so that it will extend such limitation so in such case will we still charge the depreciation if we didnt use it sir

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oh ok sir i thought it is an abnormal loss but i confused now i am getting a basic idea ok sir thanks

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Financial Statements of Companies

answered on 23-Jan-25 18:18

Illustration 4-pg : 11.34. Note no :11&12, How they segregated foods stuffs as (note 11) and Wines, Cigarette, Cigars as (note 12)

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Oh ok. Thank you

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test in as 10

answered on 21-Jan-25 11:38

on 12th question the given options are wrong and the given explanation is also wrong. explanation provided on the question: Net book value after 3 years before revaluation is ₹4,100,000 ((4,000,000 + 400,000 + 200,000) - ((4,600,000 / 10) * 3)). Revaluation surplus is ₹5,500,000 - ₹4,100,000 = 14,00,000 but actually its not 4100000 its 3220000 so the ans is not in the given option please verify and crt it

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thanks sir

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How is financial information used in accounting?

answered on 21-Jan-25 09:29

I'm trying to understand how financial information is utilized in accounting processes. Could you explain it's purpose and how it support decision making?

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A clothing retailer orders 500 T-shirts from a supplier for ₹50,000. The supplier sends an invoice, which the retailer records as a purchase and an equivalent Accounts Payable (liability) entry for ₹50,000. The retailer sells the T-shirts for ₹80,000 total. This sale is recorded as an increase in Sales Revenue. This is how financial information is recorded. At the end there is a profit of 30,000 which can be computed by preparing financial statements. And based on this future decisions can be taken

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answered on 21-Jan-25 08:43

sir what if we didnt dispose it or we didnt retire it and holding it for disposal rather the asset still have the capacity to work but since the asset is completely depreciated we have to remove it from accounts point of view but in reality we still use it so i heard that company would denote 1rs as the value of asset to just to make the asset on the accounts but what is the real treatment sir or the said way is correct

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👍

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answered on 28-Jan-25 00:03

but sir old method made sense but ok since new method came i update myself but sir how can i know such repairs can be a capital exp rather an revenue exp iam asking this because previously i easily can recognize that if the repair help me to push the assets original capacity then it is capital exp if it is maintaining or less than original capacity then i can say it is revenue exp but now on what basis i identify it in exam sir like if the repair enhanced the asset capacity of 6hr (original capacity was 10hr) to say 7hrs will that be capital and if it maintains the 6hrs then will that be revenue exp

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ok sir thanks doubt is clarified

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answered on 28-Jan-25 00:04

sir in immediate previous class u said first fv of outgoing asset second fv of incoming asset if both fv is not there then book value or carry amount of outgoing asset should be considered but here in this video u choose fv of incoming asset when we have both old and new assets fv please clear this doubt and thanks in advance for clearing the doubt sir.

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ok sir thanks i got it the doubt is clarified

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commercial substance of the asset being acquired should be distinct and enterprise specific value

answered on 21-Jan-25 11:46

sir can u verify whether my understanding with this topic is correct Commercial substance = Meaningful economic impact + Alignment with the exchange's purpose here Alignment with the exchange's purpose = enterprise specific value like if entity purchases an asset with compensation of old asset and such new asset have the potential economic benefit relating to the intend of such exchange means we can call it as a valid exchange or it will be treated as just swap. eg A textile company exchanges an old weaving machine for a new weaving machine in intend to produce more The old machine could produce 500 meters of fabric/day. The new machine can produce 1,000 meters/day, significantly increasing production capacity and revenues. since it has a significant economic benefit and the intend of exchange is satisfies this will be treated as if we sold our old machine and purchased new one and if there is gain or loss after doing the calculation ( fv of new - book value of old machine = gain or loss) then such items would be recorded but if the commercial substance is not there then we would treat it as a swap like we would treat it as sales of old machine is in book value and in place of that we show the new machine as purchase. so am i getting this topic sir and thanks in advance for the doubt clarification sir.

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ok sir thanks for adhering my understanding

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