Cost of land or building
This query is : Resolved
10 August 2021
the capitalization of development cost of land like land filling, cleaning, grading, levelling are part of land cost or part of Building cost.
Assessee wants to make building for its own business purposes. He deals in food grains.
please clarify.
Assessee wants to make building for its own business purposes. He deals in food grains.
please clarify.
10 August 2021
Add it to building cost as levelling and filling is a prerequisite for construction of building.
10 August 2021
But as per AS 10 all cost incurred to make the assets ready for intended use should be capitalized as part of the assets cost. On this ground auditor insisting that land development cost should be part of land as it is being improved so that building can be formed on it. Kindly enlighten further.
10 August 2021
In such a case follow the accounting standards.
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