08 September 2011
Dear sir/Madam i want to know that what will be accounting entries for custom duty paid on importing of a machinery . Either it need to be capitalized .or it will reflect in profit and loss account .
As per my understanding whatever credit we will get for cvd is our asset and should shown in asset side of balance sheet .
And actual amount paid for custom duty need to be capitalised . But again a question struck in my mind . After capitalising custom duty we will calculate depreciation on custom duty also . It will be just like write off of depreciation . Either it will be allowable under Income Tax Act .
CAclubindia
