Assertion (A): Under Ind AS 16, land and buildings are separable assets and are accounted for separately. Reason (R): Land generally has an infinite useful life, whereas buildings have a limited useful life. Choose the correct option.
A.A is true but R is false
B.Both A and R are true and R is the correct explanation of A
C.Both A and R are true but R is NOT the correct explanation of A
Explanation:
Ind AS 16 requires separate accounting for land and buildings because they have different useful lives. Land is usually not depreciated (infinite life), while buildings are depreciated over their finite useful lives. R correctly explains A.
Explanation:
Interest allowed reduces the actual bank overdraft (Pass book). To make the Cash book overdraft match this lower figure, it must be deducted.
No comments yet. Be the first to start the discussion!