15 June 2011
our concern has purchased waterproofing tarpaulin to protect stock for rs.21,00,000.my question is whether it will be treated a consumable item of revenue expenditure or capital asset considering it as capital expenditure.pls advice
18 June 2011
If the item purchased is going to give benefit in the coming years too and if will long last then it will be considered under assets and will be capitalized. Thus, the nature of the asset and its durability is the consideration point for classification it into either Revenue or Capital.
CAclubindia
