CAPITALISATION OF AN ITEM
This query is : Resolved
01 March 2008
IN CASE OF AN MOVABLE VEHICLE LIKE LOCO IF ITS MOTOR IS CHANGED AND MAJOR PARTS OF ITS BODY IS ALSO REPAIRED. BUT ITS REGISTRATION NO. IS NOT CHANGED. THIS MAY RESULT IN INCREASE IN THE PREVIOUS ESTIMATED LIFE OF THE ASSET. BUT IT DOES NOT RESULT IN CHANGE IN ITS CARRYING CAPACITY. SHOULD SUCH EXPENDITURE BE CAPITALISED OR TREATED AS REVENUE EXPENDITURE?
01 March 2008
IF IT INCREASES ESTIMATED LIFE THAN SUCH EXPNDITURE SHALL BE ADDED TO WDV AND DEPRICIATION SHALL BE CHARGED ON THE NEW LIFE OF AN ASSET
01 March 2008
SUBSEQUENT EXPENDITURES RELATED TO AN ITEM OF FIXED ASSET SHOULD BE ADDED TO ITS BOOK VALUE ONLY IF THEY INCREASE THE FUTURE BENEFITS FROM THE EXISTING ASSET BEYOND ITS PREVIOUSLY ASSESSED STANDARD OF PERFOMANCES & IN INCREASED IN ESTIMATED LIFE. SO IN YOUR CASE YOU CAN CAPITALISED THE AMOUNT IF IT IS SATISFYING THE ABOVE CONDITIONS.
03 March 2008
If any expenditure on the existing assets increase the life of the asset then it should be capitalised.
In ur question, the expediture on its motor may be capitalised, but the repairs of body part should be charged to revenue.
In ur question, the expediture on its motor may be capitalised, but the repairs of body part should be charged to revenue.
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?
- RCM applicability on Rent Paid by Registered Person to Unregistered Landlord for Residental Building
- ITC temporary reversal and reclaim
- GST on export of services and Input Credit
- Inventory of finished goods
- Applicable TDS rate for sale of property in Nov 2024
- Tds on building rent monthly
- REGARDING 25 AS DATE OF PAYMENT AND DATE OF BOOKING
- Quiery in relation to GST liability in case of an advocate who has obtained GST registration.
- Can we claim ITC of Feb-2024 in the month of November-2024 which was not claimed by oversight
- Disallowance of Section 43B(h) to sez units
- Regarding Waiver of Interest levied u/s 50 of PGST/CGST Act
- 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 ?
- 133(6) DIN INVALID format error - ->WHERE TO REPLY 133(6) notice?
- Query for dubts
Trending Online Classes
CAclubindia
