11 October 2010
"X" company purchased some motors for its plant running purpose on credit basis. How could we make enty ? Whether Plant repairs and maintenance or purchase. Is the motor used for a plant coming under fixed asset?
11 October 2010
It depends upon the use and importance of the motor. In case, it has its own useful life and can be used as a separate asset, then it can be treated as an asset.
On the other hand, if the plant can operate without it, and it does not effect the life of the plant, then it can be treated as Repair & maintenance.
CAclubindia
