AS 10, demurrage charge
This query is : Resolved
16 August 2007
Whether can we capitalize demurrage charge to imported capital items ?
16 August 2007
Yes,
Cost incurred to bring the asset to present location includes Demurrage charges as it is incurred before bringing the asset to it's present location. i.e. factory.
Cost incurred to bring the asset to present location includes Demurrage charges as it is incurred before bringing the asset to it's present location. i.e. factory.
17 August 2007
As per para 20 of AS 10 states that the cost of a fixed asset should comprise its purchase price and any attributable cost of bringing the asset to its working condition for its intended use.
Demurrage charges are charges in the nature of delayed clearing charges which are charges to be incurred to bring the asset to its working condition for intended use.
It is a finance charge and should be expensed off immediately. No part of such charges should be capitalised.
I hope this would satisfy you.
Demurrage charges are charges in the nature of delayed clearing charges which are charges to be incurred to bring the asset to its working condition for intended use.
It is a finance charge and should be expensed off immediately. No part of such charges should be capitalised.
I hope this would satisfy you.
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
- STCG....................................................
- Section 54F - Exemption on LTCG in 2026 for HP purchased in 2023
- Sales return eway bill
- TAN for Partnership
- AMOUNT RECEIVED UNDER COMPULOSRY ACQUISITION OF AGRICULTURAL LAND
- Plot of land. Cost of Acquisition
- Is E Way Bill Valid If Transport ID Not Mentioned in PART A But Vehicle details mentioned in PART B
- Standard Deduction claim for EPFO Pension and ICICI Prudential Life Annuity
- Loan by Partnership Firm
- TDS related Query_Liquidated Damages
- AY 26-27 ITR-4 FILING U/S 44-ADA
- Sales amount in Gstr1
- CG after sale of flat
- E Commerce GSTR1 & 3B how to file
- Nomination of Bank for refund in itr 2
- GST Cancellation without jurisdiction
- Legal Opinion on Registrar's Refusal to Investigate a Society for Non-Renewal and Non-Compliance
- GST Refund_RFD-01
- Form10BD was uploaded successfully without any Error but after 24 hours, Form10BE are not available
- Annexure B utility for GST Refund
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
