can some one give information when to capitalise ...
what to capitalise
4 Replies
RAJA P M
("Do the Right Thing...!!!")
(128091 Points)
Replied 10 January 2019
Ask with details as Where / Which / Who / When
Prakash Gehani
(Consultant & Teacher(Whatsapp 8718057907))
(1306 Points)
Replied 12 January 2019
An expense shall be capitalise:
If new asset is acquired,
If new asset is constructed,
If it results in increase in revenue generatin capacity,
If it results in increase in effiviency,
It provides enduring benefit.
Basically capitalise means such expense will be part of cost of asset and will be written off in no. of years, as such expense provide enduring benefit.
for eg. Wages paid to labour for construcion of building will be debited to building account instead of wages account, installation charges on machinery will be debited to machinery account instead of Installation charges account.
If new asset is acquired,
If new asset is constructed,
If it results in increase in revenue generatin capacity,
If it results in increase in effiviency,
It provides enduring benefit.
Basically capitalise means such expense will be part of cost of asset and will be written off in no. of years, as such expense provide enduring benefit.
for eg. Wages paid to labour for construcion of building will be debited to building account instead of wages account, installation charges on machinery will be debited to machinery account instead of Installation charges account.
Law Aspire
(CS)
(755 Points)
Replied 21 January 2019
| Originally posted by : Prakash Gehani | ||
 |
An expense shall be capitalise:If new asset is acquired,If new asset is constructed,If it results in increase in revenue generatin capacity,If it results in increase in effiviency,It provides enduring benefit.Basically capitalise means such expense will be part of cost of asset and will be written off in no. of years, as such expense provide enduring benefit. for eg. Wages paid to labour for construcion of building will be debited to building account instead of wages account, installation charges on machinery will be debited to machinery account instead of Installation charges account. |  |
We pay a consolidated amount to the Contractor and after that contractor pay the wages and reimburse himself for other expenses like cost of material purchased
, then how the accounting effect will be done
Prakash Gehani
(Consultant & Teacher(Whatsapp 8718057907))
(1306 Points)
Replied 21 January 2019
capitalise all amount paid to contractor
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