Let us see the accounting entries related to assets and depreciation:
| S.No. | Particulars | Journal Entries |
| 1 | Purchase of Fixed Assets | Asset A/cDr.To Bank A/c |
| 2 | Expenses on purchase of Fixed Assets | Related Asset A/cDr.To Cash/Bank A/c |
| 3 | For Providing depreciation | Depreciation A/cDr.To Assets A/c |
| 4 | Transfer of depreciation to Profit & Loss a/c | Profit & Loss A/cDr.To Depreciation A/c |
| 5 | Sale of Assets | Bank A/cDr.To Assets A/c |
Depreciation = Cost of AssetsâScrap Value of AssetsEstimated Life of Assets
