Capitalisation
This query is : Resolved
15 February 2014
labour food expenses for construction of building should it be capitalised? ?
15 February 2014
well you should normally capitalize expenses specifically incurred in relation to generation of the asset. so labour food expenses could also be included.
16 February 2014
As per Indian GAAP Framework, before to recognized an item as "assets", you need to ask few question, and if the answer is yes then you can do the capitalized that as assets :
1. it should result in future cash flow or to be used.
2. the amt should be material, it refer to 1% of gross income.
Now, I come to your query, since the food exp does not result in result of generation future cash flow.
Hence, it should certainly to be recognized as EXPENSE.
Also, as per AS-9, such exp to be booked as expense.
1. it should result in future cash flow or to be used.
2. the amt should be material, it refer to 1% of gross income.
Now, I come to your query, since the food exp does not result in result of generation future cash flow.
Hence, it should certainly to be recognized as EXPENSE.
Also, as per AS-9, such exp to be booked as expense.
16 February 2014
As per Indian GAAP Framework, before to recognized an item as "assets", you need to ask few question, and if the answer is yes then you can do the capitalized that as assets :
1. it should result in future cash flow or to be used.
2. the amt should be material, it refer to 1% of gross income.
Now, I come to your query, since the food exp does not result in result of generation future cash flow.
Hence, it should certainly to be recognized as EXPENSE.
Also, as per AS-9, such exp to be booked as expense.
1. it should result in future cash flow or to be used.
2. the amt should be material, it refer to 1% of gross income.
Now, I come to your query, since the food exp does not result in result of generation future cash flow.
Hence, it should certainly to be recognized as EXPENSE.
Also, as per AS-9, such exp to be booked as expense.
16 February 2014
Sanjeev sahab,
for an internally generated asset, the expenses related to construction activity also need to be capitalized that would include labour cost (which generally also involve food expenses)
for an internally generated asset, the expenses related to construction activity also need to be capitalized that would include labour cost (which generally also involve food expenses)
16 February 2014
Jo karna hai wo karo yaar, I responded what is in framework... thanks
pls ignored..
pls ignored..
16 February 2014
thanks for your expert advice sir :) I am also responding within the framework AS - 10 Para 10.1. :)
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- CAPITAL GAIN BASE ON NOTIFICATION
- Form 140 tds
- Taxable or Tax exempt
- ADVANCE PAYMENT OF ADVOCATE
- FAST-DS 2026 Under Tax Law - No recourse or support for person declaring via this scheme?
- NRI starting business in India
- TDS Deducted AY-2013-14 Not Reflected in 26as
- Demand Outstanding AY 2013-14 TDS Deducted not shown in 26as
- Eway bill not cancelled within 24 hous what can be due
- Filling ITR - U
- Tally: Imported bank entries do not show up in manual reconciliation
- Sales of goods of amount Rs97 lakhs to a party
- Confused About My Career After 12th — Cyber Security, AI or Finance? Need Guidance
- STATUTORY AUDIT OF A SMALL PRIVATE COMPANY INCORPORATED ON 28.03.2025
- Guidance Needed: Linking Multiple Form 26QB Payments and Responding to ITD Defaulter Notice
- How to pay remaining amount of TDS after due date?
- Resigning a auditor from the company for misconduct
- RCM @ 5% on Hamali charges, Transport Charges, Unloading charges we take ITC or not
- CALCULATION OF DEFFERED TAX - OP BL IS DTL & CURRET IT DTA
- LLP audit under companies act
Trending Online Classes
-
DT & Audit (Exam Oriented Fastrack Batch) - For May 26 Exams and onwards Full English
CA Bhanwar Borana & CA Shubham Keswani
Subscribe to Pro
Join an elite circle of professionals
CAclubindia
