Accounting for Exchange fluctuation
This query is : Resolved
Ravi Kumar Rajgaria
(Querist)
22 January 2010
Our company purchased some computers in $1500 on 01.01.2010. Converson rate on 01.01.10 was Rs. 46/- we paid $1500 on 20.01.2010. Rate on that date was rs. 47/-.
We booked in our books on 01.01.2010 as Fixed assets purchased for Rs. 69000 ($1500*46)so as creditors. and on 20.01.10 liability paid by Rs. 70500/- ($1500*47).
Now what will be the treatment of the differnce of Rs. 1500 as exchange loos?
Will it capitalised with assets or show under P/L A/c?
We booked in our books on 01.01.2010 as Fixed assets purchased for Rs. 69000 ($1500*46)so as creditors. and on 20.01.10 liability paid by Rs. 70500/- ($1500*47).
Now what will be the treatment of the differnce of Rs. 1500 as exchange loos?
Will it capitalised with assets or show under P/L A/c?
CMA Ramesh Krishnan
(Expert)
22 January 2010
It will be capitalised the particular computer as per AS-10
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