Company A sold machinery having a WDV of ₹ 40 lakh to Company B for ₹ 50 lakh (FV ₹ 50 lakh) and the same machinery was leased back by Company B To Company A. The Lease back is in nature of operating Lease. Being an Auditor suggest the treatment to Company A.
As an auditor, I would suggest that Company A should recognize the profit of ₹10 lakh immediately. In this scenario, Company A has sold the machinery to Company B for ₹50 lakh, even though the written-down value (WDV) of the machinery was ₹40 lakh. The difference of ₹10 lakh between the selling price and the WDV represents a profit on the sale of the machinery. Since the leaseback arrangement is in the nature of an operating lease, and not a finance lease, Company A should recognize the entire profit of ₹10 lakh immediately at the time of the sale. Operating leases are typically treated as normal rental agreements, and any profit or loss on the sale should be recognized upfront.
Which of the following statements are correct with respect to sugar alcohols?
Options:
1. They may be found in foods that are labelled ...
Which of the following is correct with reference to consumption of proportions of Food Groups indicated in NIN/ICMR ‘My Plate for the Day’?
Some of the benefits of traditional methods of food preparation like soaking, sprouting and fermentation of pulses are:
Options:
1. The...
Which of the following is the richest source of calcium/100 g of food?
Which one of the following colours is permitted for use in food?
How many of the following are prebiotics permitted for use in Health supplements and Nutraceuticals?
Options:
1. Lactulose
2. P...
In which of the following cooking methods, does the internal temperature of food exceed 100° C?
With respect to the functions and requirements of Vitamin D in the body which of the following statements are correct:
Options:
1. It i...
Erythritol provides ______ kcal/g.