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hi sir
in the question Doric Co. (december 2010 q1) part (b) says to calculate the income position for which we need to calculate the tax allowable depreciation.
for this the marking scheme answer takes the old balance sheet NCA values instead of the revalued amounts for non current assets.
why?thanks so much
It is because the tax people use depreciation based on the original cost (not the revalued amount).
(Otherwise everyone would try and save tax by revaluing and then charging higher depreciation and getting a lower taxable profit 🙂 )
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