Relate to as
This query is : Resolved
12 August 2014
I have a Pvt. Ltd. Co. I Bought machinery for manufacturing by raise a loan a/c. But production will start from next year. Please show me the treatment of finance charges for 1st year, according to "Accounting standard". Which Accounting standard will apply? Treatment for capitalization of finance charges.
12 August 2014
Please be guided by As-16 Borrowing cost
12 August 2014
Mr. Kedar Please explain and help me.
12 August 2014
please explain treatment for finance charges.
12 August 2014
1) Till date asset is ready for its intended use, you can capitalise the finance cost (add to cost of asset) provided the funds borrowed are wholly used for the purpose.
2) If the funds are borrowed for general use then pro rata basis finnace cost to be worked out
3) In case till the the asset is ready for its active use, you have deposited funds in deposits and earned interest , the interest earned has to be deducted
4||) Once the asset is ready fort inteneded use , capitalisation of financed cost will stop.
For more details plesae read AS-16 issued by ICAI
2) If the funds are borrowed for general use then pro rata basis finnace cost to be worked out
3) In case till the the asset is ready for its active use, you have deposited funds in deposits and earned interest , the interest earned has to be deducted
4||) Once the asset is ready fort inteneded use , capitalisation of financed cost will stop.
For more details plesae read AS-16 issued by ICAI
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- Is this income indian or foreign income?
- GST on export of services and Input Credit
- RCM applicability on Rent Paid by Registered Person to Unregistered Landlord for Residental Building
- ITC temporary reversal and reclaim
- Applicable TDS rate for sale of property in Nov 2024
- Inventory of finished goods
- Tds on building rent monthly
- GST ON EXPORT COMMISSION
- Can we claim ITC of Feb-2024 in the month of November-2024 which was not claimed by oversight
- REGARDING 25 AS DATE OF PAYMENT AND DATE OF BOOKING
- Sale of property furniture sale
- Confusion around Form 26QB fields
- Adjustment entry in the case of Individual and HUF on 31st March
- Stock difference tax applicable on composite rate or normal rate
- LAST YEAR 2022-23 ITC IN NEXT YEAR 2023-24 REPORITNG IN GSTR-9
- MIS MATCH OF INVOICE NUMBER
- IGST Credit-Show cause notice issued-confusion
- Issue of gst e invoice
- How to adjusted advances given or receipt
- Foreign vendor without PAN unable to to register due to non receipt of OTP on foreign number ?
Trending Online Classes
CAclubindia
