Civil work(foundation) after capitalisatio of machine
This query is : Resolved
Querist : Anonymous
Querist :
Anonymous
(Querist)
20 February 2012
We have capitalised Machine in Mar11 and now we are planning to make civil foundation to that machine to reduce manpower involved in that machine.
So wheather the civil work expensed should be capitalised or charged to P & L account and under what reason.
Regards
Bharat Trivedi
So wheather the civil work expensed should be capitalised or charged to P & L account and under what reason.
Regards
Bharat Trivedi
28 February 2012
The expenditure on civil work will enhance the Productive Capacity of the Machine, since it will reduce manpower.
There will be a recurring benefit for more than a year.
Hence the expense should be capatalized.
There will be a recurring benefit for more than a year.
Hence the expense should be capatalized.
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