Can Inventory be transfered Fixed Assets

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Hi, We are dealing (Trading) in diagnostic instrument and treat them as our inventory. Now we have transfered some instrument to our employees for testing purpose and they will never be sold. They will either be given back by the employees at the time of resignation or transfered to new employees. Now can we treat these instrument as our fixed assets and chrged depreciation. What is according to AS and what are the necessary entries to be passed.

 

Many Thanks in advance

Sumit Chaturvedi

9910044270 

Replies (5)

As ownership will be in the name of the company it self you can transfer it to your fixed assets and claim depreciation.

Originally posted by : praveen

As ownership will be in the name of the company it self you can transfer it to your fixed assets and claim depreciation.

yes agreed               

if i assume this testing as some kind of research then it will be treated as expenditure. As per AS 26 ( intangible asset) any exp incurred toward research will be treated as expense.

yes treat them as fixed asset and charge depreciation

sir pls tell me that we have a supremarket so the inventory which is leving in the ware house or in the smkt. we can claim depreication on inventories held for sale to the conusmers. a per the acounting standards - 2& section 145 of the income tax act, 1961. Also i have heard that ITAT jugment is alos there which  say that depreication cannot be claim on the inventoreis held for sale to the final consumer's.

 

si rpls help me out.

 

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