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Depreciation

Corporate & Other Laws

If an asset say car is not used after certain period of time it will depreciate Is this the same case with car in show room

Prasanth kumar Kamisetty

CA Inter

★ 12K+

25-Sep-20 21:46

314

Answers (6)

In case of showroom it's their STOCK IN TRADE

Nithish Kumar

CA Final

★ 6K+

25-Sep-20 23:59

Nithish Kumar

In case of showroom it's their STOCK IN TRADE

Didn't understand

Thread Starter

Prasanth kumar Kamisetty

CA Inter

★ 12K+

26-Sep-20 07:32

Its inventory

CA Suraj Lakhotia

Admin

26-Sep-20 08:24

CA Suraj Lakhotia Admin

Its inventory

Though it may beinventory after some peroid of time i.e till the good is sold due to non usage wont they be depreciated

Thread Starter

Prasanth kumar Kamisetty

CA Inter

★ 12K+

26-Sep-20 08:54

Thread Starter

Prasanth kumar Kamisetty

Though it may beinventory after some peroid of time i.e till the good is sold due to non usage wont they be depreciated

Depreciation is on Fixed assets. Inventory is valued on cost or net realizable value ( typically) at the end of every reporting period. So if there is a reduction in value of car in showroom, the dealer / company will take a loss on account of its reduction in value. That loss will be debited to P&L account