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Capitalization of fixed assets

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Querist : Anonymous

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Querist : Anonymous (Querist)
30 November 2015 Suppose a company has two units.
A machine Costing Rs 10,50,000 (Basic cost 1000000 + CST 20000 + Carriage 15000 + L&U charges 15000) purchased at unit A but not capitalized.

Now this machine transferred to Unit B incurring transport cost of Rs 20000.

So what is the amount to be capitalized at Unit B.
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Amol S Joglekar

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Amol S Joglekar (Expert)
30 November 2015 What is the time gap between receiving machine at unit A and then transporting it to unit B?

If it is concurrent and imediate, capitalise the transport cost, else it can be treated as revenue expenditure.
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Prasad Kadam

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Prasad Kadam (Querist)
30 November 2015 What is treatment of Carriage & L&U exp incurred at Unit A. will it b capitalised??



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Amol S Joglekar

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Amol S Joglekar (Expert)
01 December 2015 yes, capitalise the same at Unit A.

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