Capitalisation
This query is : Resolved
Querist : Anonymous
Querist :
Anonymous
(Querist)
09 May 2012
My company is into construction business..... During the year they have purchased sheets which are used as barricades which will be sold as scrap after completion of construction. Should I capitalise this item? If yes under which category does it fall under companies Act and Income Tax Act.
09 May 2012
If you are going to scrap them after the construction gets completed, then dont capitalise them under Building. It the building work is going to be completed within a year, then its better to charge it to profit and loss account. However, if it is going to range over a year, you can capitalise them and claim depreciation / write-off accortingly. The treatment wont change any of the Act.
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Querist : Anonymous
Querist :
Anonymous
(Querist)
10 May 2012
my 1st part of query is answered.My subsequent query was under which category should I capitalise? Is it Plant and equipment Or Furniture and fittings? or Fixtures?
10 May 2012
You may capitalise it under temporary structures.
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