Capitalisation of First insurance
This query is : Resolved
18 October 2007
It has been usualy seen that people capitalize the first insurance of any capital asset along with it's cost...is it correct??...what i feel is that it is a period cost as it expires after the period in which it was capitalised and so it should be charged as revenue instead...what the experts say??
18 October 2007
You r right that its a period cost, but as per law if insurance is compulsory to run the capital asset then its a capital cost in first year of its running.
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