Capitalisation of Pre Operative Expenses
This query is : Resolved
22 August 2008
Can Salaries and other expenses incurred by a company for its expansion project be capitalised. If yes, whether a part of the salaries can be capitalised and the balance be charged to Profit and Loss Account
22 August 2008
Hi !
Directly attributable cost is to be capitalised. like Site Preparation, Initial Delivery/Handling Cost, Installation Cost, Professional Fees.
Administration Chg & other chg are generally excluded because they do not relate to specific fixed assets. But in some cases where cost is identificable & incurred for the asset to put it in working condition, then it can be capitalised.
Regards'
Yatesh Renuke.
Directly attributable cost is to be capitalised. like Site Preparation, Initial Delivery/Handling Cost, Installation Cost, Professional Fees.
Administration Chg & other chg are generally excluded because they do not relate to specific fixed assets. But in some cases where cost is identificable & incurred for the asset to put it in working condition, then it can be capitalised.
Regards'
Yatesh Renuke.
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