Capital Work in Progress
Mehul Sheth (Audit Executive) (73 Points)
02 March 2018should this expense be treated as capital work in progress or should it be treated as renovation expense and hit p&l
Mehul Sheth (Audit Executive) (73 Points)
02 March 2018
satish
(teaching)
(2046 Points)
Replied 02 March 2018
Refer AS 10 Property plant and equipment, for which expenditure is to be capitalise.
but in your case any expenditure relating to dimantling at old premises and installation in new premises is considered as shifting charges. so this will treat as subsequent expenditure. in this case you need to check "does subsequent exp increase in fututure economic benefits or not".
if Yes exp can be capitalise. else treat as revenue exp.
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