purchse of projector prior to incorporation of company

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Querist : Anonymous

Querist : Anonymous (Querist)

12 May 2010 Please guide me on how to account for a office equipment purchased before the date of incorporation of a private limited company ?

The company is a joint venture between an Indian Company and a foreign company. The invoice is in the name of Indian company. the amount is paid by the indian company on behalf of the Joint venture company.

It has been agreed that as soon as the joint venture company has is own funds, all these type of cost shall be recharged to the joint venture company.

So my question is that whether this OFFICE EQUIPMENT can be capitalized in the boos of Joint venture ? If yes, what should be the date of capitalization.?

Thanks a lot

CA. BIJENDER KR. BANSAL

CA. BIJENDER KR. BANSAL (Expert)
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12 May 2010 As you say that Invoice is in the name of Indian Company. You have to sell it to Joint Venture company from Indian Company and capitalized in Joint Venture company book. You can sell it on original purchase value or wdv as on date, it is your own choice.