Assets

Tippy
Tippy Registered Posts: 3 New contributor ?
Hi, this is my first post and am currently studying Technician level and thought this question would be more suitable to ask a MIP.

My cousin has decided to prepare her own partnership accounts this year (she is a book keeper) with my assistance. They are quite straight forward apart from, in last year's accounts she had a change of car which was correctly introduced but when the old car was written off, the van was written off as well. What would be the correct way to re-introduce the van? On last year's P&L, the removal of both assets resulted in a loss of £1400.

Many thanks

Comments

  • slackda
    slackda Registered Posts: 460
    just out of interest why would you be re-introducing the van? was it written off incorrectly or is she now "selling" the van back to the partnership?
  • Tippy
    Tippy Registered Posts: 3 New contributor ?
    The van was written off incorrectly in the previous years accounts.
  • slackda
    slackda Registered Posts: 460
    Reverse the transaction or the part of the transaction that related to the writeoff of the van, ideally you have an asset register with the YTD depreication of each vehicle rather than just a lump sum in a t-account.

    i.e put your depriciation and the value of the asset back into the the balance sheet and the disposal cost back into the P&L.
    oh and don't forget any tax allowances/charges that you may incurred as a result of the w/o.
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