Ceiling fan than Rs.5000 accounting treatment

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Dear Experts,
our company purchased 6 ceiling fans of Rs.1350 each
what will be the accounting treatment of this transaction
Replies (4)

RCM not applicable , More than 5000/-  RCM  has been scraped  . 

Pass J.E  in the companies books as follows  if  GST  charged . 

Fans            A/c       Dr

CGST          A/c       Dr 

SGST          A/c       Dr 

To  Trade  Creditors         A/c    Cr 

(  Booking  entry for purchase of Fan ) 

Fans under  Non current assets - balance sheet 

 

Sir, price of single fan is Rs.1350 only, how to book under non current assets

Is  CGST  & SGST  included  in cost  1350/- ?   , if  not  then  you can show   8100/- (  1350*6 )  total  amount  in  balance sheet  under head fans   and  write  in narration  , each fan for 1350/- 

An asset should be capitalized if it is not held for resale but for the production, supply, rental or administrative purposes and it is expected to be used for more than one accounting period. So, you can capitalised the Amount of ceiling fans purchase in your books of account as mentioned by Prasad Nilugal ji.
or if Amount is not material as per your business transaction, than you can Expensesed out this amount directly to Profit and loss Account...


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