Capitalization or purchase or expenses

This query is : Resolved

VIPIN KUMAR SENGAR (Querist)
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30 October 2013 Basically, our company earned commission income on sale of goods.
Now, our company want to sell honey. So, they purchase Bee Hives with live bees.
I want to know live bees is capitalized item or purchase or expenses?
Please solved my query?

Ganeshbabu K

Ganeshbabu K (Expert)
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30 October 2013 it is purchases
.
.
because you want to sale honey

VIPIN KUMAR SENGAR

VIPIN KUMAR SENGAR (Querist)
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30 October 2013 but we are not purchasing honey. we are purchasing live bees and bees produce honey.

Ganeshbabu K

Ganeshbabu K (Expert)
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30 October 2013 yes you purchase live bees,,and then u maintain and some expences incurred
..
.and honey you sold
.
.
in my opinion it is purchase only you cannot capitalize

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