Asset valuing less than 5000
This query is : Resolved
06 March 2014
if a mobile is purchased of rs.1500 and is recorded as expense by co. Is this treatement correct or it must be recorded as f.a.
Guest
Guest
(Expert)
06 March 2014
As per accounting standards it should be capitalized..but in general practice we normally booked as a expense these small expense..and ya now there is nothing like limit of 5000 u mentioned.So all capital expense should be capitalized..
Sandeep Dharar
(Expert)
06 March 2014
There is no limit if Rs. 5000/-. But it depends on the nature of transaction either. If the mobile is purchased 4 staffs it belongs 2 the company & not to staffs, suppose if the staff left the work then he will not take the cell phone with him. So i suggest to Capitalized it & do not record it as expense.
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