Is change in the provision for gratuity and depreciation considered as change in methods of accounting in india?
Answers
Answered by
3
☆☆☆☆☆hii mate ☆☆☆☆☆
HERE IS YOUR ANSWER ⤵⤵⤵⤵
Matching concept is a very significant concept of accounting. According to this concept income and expense must be recognised in the period to which they relate. In India, Profit & Loss is computed in accordance with two different sets of provision one set is Profit & Loss as per Companies Act, 2013 (earlier it was Companies Act, 1956) and second one is Profit & Loss as per Income Tax Act, 1961 (for the purpose of computing taxable income). Generally there is difference between Profit & Loss computed as per above mentioned two different set of provisions. The root cause of this difference is different treatment of some items of expenditure/income under both set of provisions (i.e. Companies Act, 2013 and Income Tax Act, 1961). Some expenditure which are allowed to be deducted under Companies Act, 2013, may not be allowed to be deducted under Income Tax Act, 1961 while computing the taxable income.
may it is you answer
HERE IS YOUR ANSWER ⤵⤵⤵⤵
Matching concept is a very significant concept of accounting. According to this concept income and expense must be recognised in the period to which they relate. In India, Profit & Loss is computed in accordance with two different sets of provision one set is Profit & Loss as per Companies Act, 2013 (earlier it was Companies Act, 1956) and second one is Profit & Loss as per Income Tax Act, 1961 (for the purpose of computing taxable income). Generally there is difference between Profit & Loss computed as per above mentioned two different set of provisions. The root cause of this difference is different treatment of some items of expenditure/income under both set of provisions (i.e. Companies Act, 2013 and Income Tax Act, 1961). Some expenditure which are allowed to be deducted under Companies Act, 2013, may not be allowed to be deducted under Income Tax Act, 1961 while computing the taxable income.
may it is you answer
Similar questions