Sir,
Can u please tell me ,if a new vehicel is purchase and insurance is paid then we will have to add that to the vehicle and show as asset.
Secondly we had paid 10,000/- as token amount to the company from whom we have purchased this new vehicle. Later that10,000/- is returned and a discount of 15000 is given by the Co.(I.e motors company) all together 25,000/- is refunded back to us.
Can u pleaze tell me the accounting entry for this.
Tahnks and regards,
Sushant.
Yes you can add this insurance (first time at the time of purchase of new vehicle) as fixed assets.
If you have received discount of Rs. 25000/- (10000+15000), you have to reduce fixed assets (vehicle) cost also.
insurance of asset will not be included in cost of asset
if you have received any discount it will reduce your cost of asset
| Originally posted by : Harpreet | ||
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Yes you can add this insurance (first time at the time of purchase of new vehicle) as fixed assets. If you have received discount of Rs. 25000/- (10000+15000), you have to reduce fixed assets (vehicle) cost also. |
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Agreed.
| Originally posted by : Harpreet | ||
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Yes you can add this insurance (first time at the time of purchase of new vehicle) as fixed assets. If you have received discount of Rs. 25000/- (10000+15000), you have to reduce fixed assets (vehicle) cost also. |
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insurance is never an capital expenditure
agreed Mr.harpreet statement.
KIND ATTN: Mr. Future CA
Pls suggest me that why everyone follows the treatment of following and pls read relevant AS:
You bought a aircondition worth Rs. 20000/- from A and Stablizer worth Rs. 2500/- from B and the same get installed by from C. Pls make the journal entry in books of accounts with relevant AS or treatment of accountancy. I will appreciate your right answer on the same.
Regards,
Harpreet
Insurance payment at the time of Purchase of new asset would be Capitalised.
At the time of purchasing vehicle, Insurance is mandatory now a days.
WHile at the time of renewal of that insurance, it would be considered as revenue exp.
| Originally posted by : CA Chintan Vyas | ||
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Insurance payment at the time of Purchase of new asset would be Capitalised. At the time of purchasing vehicle, Insurance is mandatory now a days. WHile at the time of renewal of that insurance, it would be considered as revenue exp. |
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Agreed.
CAclubindia
