Whether broadband connection charges (data card) should be capitalized or it will be treated as revenue expenditure, if broadband is used by the company for official purposes.
24 Replies
Resham
(Carpe Diem !!!)
(6535 Points)
Replied 16 June 2011
Just like Telephone expenses it is to be treated as a revenue expenditure... I just confirmed this with a senior... fully debited to P & L A/C...
Sultan Mohiuddin
(Practicing Chartered Accountant)
(56 Points)
Replied 16 June 2011
revenue expenditure.
materiality matters..and not just nature of expense!
CS,CA F,Numrologi TusharSampat
(CS CA F Numerologist Astrologer Graphologist Face reader Vastu Expert)
(85930 Points)
Replied 16 June 2011
Revenue expenditure.
Rajnikant Vadigoppula
(CA, CS And CMA Final)
(919 Points)
Replied 16 June 2011
connection charges and modem charges should be capitalised and recharge or usage charges should be charged to revenue
shubham
(CA FINAL NOW )
(138 Points)
Replied 16 June 2011
agree with mr. rajnikant . connection charges and modem charges should be capitalised and recharge or usage charges should be charged to revenue
U S Sharma
(glidor@gmail.com)
(21063 Points)
Replied 16 June 2011
as datacard has no market value in absence of connection, so its revenue expenditure.
M. N. JHA
(CA)
(8316 Points)
Replied 17 June 2011
Monthly charges should be revenue exp and modem exp exceeding rs. 5000 should be capitilized otherwise. . . . .
lokesh maheshwari
(partner)
(62 Points)
Replied 17 June 2011
according to schedule VI and AS-6 assets less than Rs 5000/- should be debited to p&l Account so if the expenditure is less than 5000 it will be treated as a revenue expenditure
CA ADITYA SHARMA
(CA IN PRACTICE )
(16719 Points)
Replied 17 June 2011
| Originally posted by : Rajnikant Vadigoppula | ||
 |
connection charges and modem charges should be capitalised and recharge or usage charges should be charged to revenue |
 |
AGREED
Anshul Shukla
(Article assistant)
(63 Points)
Replied 17 June 2011
It depends on the cost of the modem if it is less then Rs 5000 you may charge it to Revenue A/c else it is a capital exp.
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