Treatment of fixed asset in cash basis of accounting

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

11 July 2011 I wanted to ask that how fixed assets will come in the Balance sheet since it has to be expensed out in the Profit & loss A/c in the year of purchase under cash basis of accounting?

CS VENKATARAMANAN S

CS VENKATARAMANAN S (Expert)
Follow

11 July 2011 Fixed Assets will not be treated as expenses on any type of accounts. They are directly debited in fixed assets account. not in the expenses account.
regards..

Message likes : 1 times

Querist : Anonymous

Querist : Anonymous (Querist)

11 July 2011 Hi,But in pure cash basis of accounting, it can be treated as an expense.....Also, cash basis doesn't distinguish b/w revenue & capital items. please throw some light on this

Upgrade to CAclubindia Pro. Subscribe Now!