PTC - Land

System
System Posts: 100,534 🤖 Admin 🤖
edited June 18 in AAT student discussion
has anybody got a simple calculation for part disposal of land, i have been reading the bpp book but it is not very clear.

thanks in advance

stuart

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  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:PTC - Land

    The formula given in the Osborne book is:-

    Original cost of whole asset x A / (A + B)
    where A is the proceeds of the part disposed of and B is the market value of the part retained.

    e.g. Part disposal of land - If the sale proceeds are £3000, the value of the remaining land is £9000 and the original cost of the whole asset was £4000, the cost applicable to the part disposed of is:-

    £4000 x £3000/(£3000 + £9000) = £1000

    Hope this helps.

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