If a company has purchased a fixed asset as a spare to be used when the principal asset is out of order, when should the company pass the accounting entry for it i.e. debitting the asset a/c & crediting the vendor A/c ? also tell me that when does the FAR would be updated?
14 February 2013
Fixed Assets Records must be updated as soon as asset has been purchased irrespective of the time of its actual use.Entry should be passed at the time of purchase itself. AS-10 nowhere mention to record the asset when it is to be used. instead it must be recorded at the time of purchase itself.
14 February 2013
Sir, if a fixed asset has been purhased not being a spare, then on which date it should be reoreded in the books, & from which date depreciation should be charged( i.e. date of capitalization) ?
CAclubindia
