What is the treatment of investments when investment fluctuation reserve is not given and the market value of investment is more than it's book value. Retirement of a partners
Dear Student
When investment fluctuation reserve is not given and investment is given then we treat it like a normal asset. Thus if the market value is more than its book value than we show it on the credit side of revaluation A/c. For example book value of the investment is 1000 and market value is 1500 than in revaluation A/c we showed it as "By investment with Rs 500" as an increase in asset and in balance sheet we add in the investment value.
Regards
When investment fluctuation reserve is not given and investment is given then we treat it like a normal asset. Thus if the market value is more than its book value than we show it on the credit side of revaluation A/c. For example book value of the investment is 1000 and market value is 1500 than in revaluation A/c we showed it as "By investment with Rs 500" as an increase in asset and in balance sheet we add in the investment value.
Regards