Interest part in emi as cost or expenses
This query is : Resolved
Prateek Jain
(Querist)
14 February 2013
Hello everyone,
I have a query that we had purchased a land from Gujarat Industrial Development Corporation(GIDC). Payment is to be made in quaterly instalments. Now I need to know that whether the interest part in EMI paid to GIDC is added to the cost of land or should be taken as expense.
There is no construction done on the land.
Pls guide me on this query
Prateek Jain
I have a query that we had purchased a land from Gujarat Industrial Development Corporation(GIDC). Payment is to be made in quaterly instalments. Now I need to know that whether the interest part in EMI paid to GIDC is added to the cost of land or should be taken as expense.
There is no construction done on the land.
Pls guide me on this query
Prateek Jain
CA Suraj Lakhotia
(Expert)
14 February 2013
Interest component should be treated as an expense.
Prateek Jain
(Querist)
14 February 2013
Thank you sir,
And one more thing, Land development cost will be added to the cost of land or will it be treated as and expense in year in which it is incurred.??
And one more thing, Land development cost will be added to the cost of land or will it be treated as and expense in year in which it is incurred.??
CA Suraj Lakhotia
(Expert)
15 February 2013
Development costs will be added to the cost of land.
Prateek Jain
(Querist)
16 February 2013
Thank u...
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