Forums
Back
Bearer plant in as-10
Accountancy
Let us consider, A plant is held such that the branches of the plant can be cut and sold as agricultural produce. It is grown with an intention to hold for 10yrs so that it will be giving produce through out the life. At the end of the life, the plant can also be cut and sold similarly like branches. Now here in this case can we consider this plant as bearer plant?? Please explain....
Answers (12)
Yes we can consider it as a bearer plant provided that 1. It is used in production or supply of agricultural produce 2. is expected to bear produce for more than one period 3. has a remote likelihood of being sold as agricultural produce, except for incidental scrap sales.
Here my doubt is with regard to the 3rd point. We actually do not sell the plant at end of its life for scrap, They will be sold as similar as the branches of plant at end of its life. Why Can't we relate this to the second point of exception of bearer plant Which suggests if a plant is grown to produce agricultural produce as well as to sell the plant as agricultural produce.
CA Suraj Lakhotia Admin
Can you give a specific example?
If rubber tree is planted for the purpose of latex production and cut as wood after useful life of it then does this trees come under bearer plant. Let us say the productive life of rubber tree be 10 yrs.
Thread Starter
VIJAYA SARADHI MAGANTIHere wood is sold as agricultural produce as well like latex
As the wood is scrapped from the tree.
Nithish Kumar
Bearer plant is that, which is expected to bear the Agricultural produce for a period more than 12 months and has remote likelyhood of sale except for incidental scrap sale . So in ur examlple Rubber tree is a Bearer plant &= PPE
What happens if I sell the tree after 2yrs as agricultural produce But useful life is 10yrs including with the sale of latex
Thread Starter
VIJAYA SARADHI MAGANTIWhat happens if I sell the tree after 2yrs as agricultural produce But useful life is 10yrs including with the sale of latex
All depends on ur own intention as to whether it has remote chance of being sold r has much chances.
lohita Prava
May I know what chapter does this come under
Syllabus of CA INTER- Accounting standard 10
Nithish Kumar
All depends on ur own intention as to whether it has remote chance of being sold r has much chances.
Thank you Nithish, helped a lot!!!
Your Reply