17 December 2007
Please tell me about Capitalisation, Transfer to respected Account & Also Send me the simple method for Calculation of Deprication & Tips for Finalisation of Balancesheet
18 December 2007
Any expenditure incurred to bring into existence a fixed asset is capitalisation. All expenditure incurred in connection with such bringing into expenditure are initially taken to capital expenditure in progress and on capitalisation transferred to the respective fixed asset account. There is no complexity involved in calculation of depreciation,especially if Straight line method. What exactly is your problem in calculation?
28 December 2007
Capitalizing an expense means to treat that expense as capital expenditure. That is it should not be debited to P & L but added with asset if asset related or to be shown in Balance Sheet. Any expenditure which gives you a long term banefit or increases efficiency of an asset or incurred prior to putting an asset to use or incurred prior to commencement of business is capital expense. Depn under SLM is calculated as Original (Cost - Scrap Value)/Useful life.
CAclubindia
