kavitha (studying final) (830 Points)
26 June 2012our's is a Manfacturing company,incorporated in 1994 and started commercial production in 2007. rent, salaries, r & d,raw material purchases( on them vat, excise duty)business promotion exp etc. how to treat them in accounts and income tax. as per revised AS 26 there is no treatment for preoperative expenses.
Karan Teli
(Life Is just an Illusion...!!)
(4573 Points)
Replied 26 June 2012
Companies act provides that pre - incorporation exp have to be capitalised completely.
But logic is killed her complety.
To justify - a company( as u mentioned) has to be incorprated to get life in it and hence there exist no evidence that there was a co. who was been runned.
Assuming it as public co. It has to get CoCoB to start it so the question itself is conflicting in nature.
CAclubindia
