Cylinder given to packaging company for making pakages
This query is : Open
29 March 2018
suppose a company " X" give cylinders ( that are used in making packaging material) to another company "Y" which is under contract of making their product packages.. so the cost of purchasing that cylinder is our expense or an asset.?
CA Himanshu Bansal
(Expert)
12 April 2018
Ideally if these "cylinders" are part of final product, it should be recorded as purchase(expense).
If those cylinder are being used for prepraring your final product and life of cylinder is more than an accouting years, management may consider to treat it as asset. It would depend on its useful life.
If those cylinder are being used for prepraring your final product and life of cylinder is more than an accouting years, management may consider to treat it as asset. It would depend on its useful life.
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