My company is a govt company and in the business of Power Distribution. Transformer and Energy Meter two are the most important items so used in the daily business activity. The problem is that :-
1)whether Transformer & Energy Meter will comes under the head of accounts as Inventory or Fixed Assets on purchase of the same ,as per any Act or accounting standard or common accounting principal.
2) If we consider it as Assets when the same was installed at work/business than it is very much difficult to accounting from Inventory to Assets as the items needed replacement frequently with out further delay. Then the replacement of assets by the inventory again need to be capatlize or to be consider as spare.
I am very much confused please advise me with specefic reasons. Please advice me on urgent basis. Thans in advance.
CAclubindia
