18 July 2010
I have started with a hospital. Now after the building is constucted, I am making pipeline to supply oxygen to each bed in the hospital. Would I be capitalising the cost of making such oxygen pipeline available or else? Moreover now I am also constructing a lift for emergency patient, so should I capitalise that cost to building or else?
19 July 2010
such oxygen pipeline should be capitalised depending on the materiality of amount of such expenditure. if the expenditure amount is substantial, then it should be capitalised.
further, LIFT should be capitalised as a seperate asset and should be depreciated seperately because life of Lift and building is considere seperately. I have seen examples of seperate capitalization in government department.
CAclubindia
