12 December 2011
Year of purchase is not the criteria for capitalising of expenses. If the repairing expenses are replacement of parts,etc. or normal repair charges then charge the same to expenses account. However, if the expenses incurred either: 1) increase the economic life of asset,or 2) Expected future benefits from car increse beyond previously assessed standard performance then capitalise the same to Car.
12 December 2011
Are u talking about that initially u expensed these now u want to capitalized those. it will be treated as change in accounting policy.
12 December 2011
If you are wanting to capitalise the revenue expense then you cannot capitalise repair charges if the benefit for the expenses was already availed by you in the earlier period. Alsodeduction has already been claimed and allowed by the Income tax department in the year of expense off.
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