Repairs and maintainence
raj shome (Student CA Final ) (62 Points)
20 March 2013
can purchases of materials made for repairing purpose be taken under the head "repairs and maintainence"?
2 Replies
Milind M. Kulkarni
(Practicing CA)
(580 Points)
Replied 20 March 2013
It is a common practice among companies to show it under Purchase of maintenance materials. Consumption of these materials (opening balance + purchases - closing balance) it treated as Repairs and Maintenance cost. Balance of materials at the year end is shown under inventories (closing stock) under consumables and stores.
DEEPU HN
(Student CA Final )
(80 Points)
Replied 20 March 2013
if material purchased for the imrovment of Fixed assets that will be taken under the fixed asset (if addition is helps in increasing the production activity beyond the normal activity) , if material used in normal production or recurring activity that will be taken under profit and loss account.
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