Query regarding Appropriate Account Head

This query is : Resolved

Guest

Guest (Querist)

04 August 2010 Dear Experts,

A is doing business, who has 10 systems for his office.

He purchased Anti-virus Software Packs (3 User Pack 3 Nos. & 1 User Pack) for all his systems. Cost comes to approx. Rs.10000/- including VAT. Separate Bill for this purchase.

He purchased Toner Cartridge for his two Laserjet printers. Cost comes to approx. Rs.8000/- including VAT. Separate Bills for these purchases.

He purchased Portable Hard Disk capacity of 1 TB. Cost comes to approx. Rs.6000/- including VAT. Separate Bill for this purchase.

He paid approx. Rs.40000/- (including ST 10.3%) for AMC for his systems and printers at the year end 31.03.10. Separate Bill for this AMC. (TDS has been deducted on this bill).

Query :

1. Whether Purchase of Anti-Virus Software Packs shall be treated as ‘Maintenance – Computer’. If not, what is the appropriate account head and reason for the same.

Ans : …………………..

2. Whether Purchase of Toner Cartridge shall be treated as ‘Maintenance – Computer’. If not, what is the appropriate account head and reason for the same.

Ans : …………………..

3. Whether Purchase of Portable Hard Disk capacity of 1 TB shall be treated as ‘Maintenance – Computer’. If not, what is the appropriate account head and reason for the same.

Ans : …………………..

4. Whether AMC shall be treated as ‘Maintenance – Computer’. If not, what is the appropriate account head and reason for the same.

Ans : …………………..

5. Is there any limit to determine the Account Head on such transactions - I am unable to have clarity. Please clarify.

Ans : …………………..

I shall wait for your views on the above queries.

Thanks in advance for all concerned.

Venkat Rao Marella

Venkat Rao Marella (Expert)
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05 August 2010 1. Computer software. (This is to be amortised over a period of 1 yr).
2. Computer consumables (you can keep debiting DVD/CD/laptop cleaners/catridges/toners to this acccount).
3.Computer external memory devices. (you can debit HDD/Pendrives to this account). Alternatively, you can keep debiting these expenses also to the computer consumables account.
4. Debit AMC paid to a seperate "AMC - prepaid" account which can be amortised over a period of 1 year.(since the AMC tenure will be valid for 1 yr).
5. Just look at the nature of the expense, purpose and determine.

Thanks.

Guest

Guest (Querist)

05 August 2010 Dear Friend,

Thank you so much for your response.

D.KARTHIKEYAN.

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Venkat Rao Marella

Venkat Rao Marella (Expert)
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06 August 2010 welcome..!