Finance charges under lease with ref. to AS - 16
This query is : Resolved
12 November 2009
Under A S - 16, borrowing cost includes the finance charges under Finance lease. Also, BC can be capitalised only if an asset is QA.
However, as per AS - 19, there is no such example or statement is provided.
Please let me know any example or case where finance charges of an leased asset under finance lease can be clubbed in the asset cost.
However, as per AS - 19, there is no such example or statement is provided.
Please let me know any example or case where finance charges of an leased asset under finance lease can be clubbed in the asset cost.
13 November 2009
Hi Abhishek, good question. Para 4 gives u the examples of borrowing costs. as per AS 16 borrowing cost can be capitalised till the time asset is ready for commercial use.Once the asset is ready for intended use, then the borrowing cost will be dr. to P/L A/c. In case of finance lease, normally, the ready to use assets are taken therefore there is no question of capitalisation of finance charges as it will then be considered as revenue exp. Thanks and regards,
CA Shakuntala Chhangani
CA Shakuntala Chhangani
13 November 2009
See in M.P. VIJAY KUMAR Book
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- GSTR-1A How to update Invoice
- Excess salary payment.
- INTEREST APPLICABLE ON ITC REVERSAL PORTION
- TDS on Purchase of Immovable Property by NRI from NRI
- Capital gain from sale of house property
- Stamp Paper for partnership firm change new income tax 2025
- Current Account Opening for Sole Proprietorship with Udyam Certificate - Zero Turnover
- SFT Cash Deposit in Current Account
- Annual return in Gst
- Regarding TDS Applicability For Director Remuneration
- Requirement of tax deduction at source by individual
- Cash gift by grand mother to her grand daughter
- Tax amount diff in Gstr1 and 3B in tax compare reports
- Tds on GST in connection with sale to public company
- Restoration of certificate of practice
- Regarding change in correspondence address in SSP portal
- No Compliences after incorporation
- USEFUL LIFE OF USED/SECOND HAND COMMERCIAL VEHICLES
- Claiming TDS deducted by builder on Hardship compensation and Corpus
- Address Change to another state of a Registered Trust with 12AB approval
Trending Online Classes
-
DT & Audit (Exam Oriented Fastrack Batch) - For May 26 Exams and onwards Full English
CA Bhanwar Borana & CA Shubham Keswani
CAclubindia
