Freight charges incurred on purchase of fixed assets
This query is : Resolved
12 April 2016
I want to know whether the Freight Charges incurred will be added to the Cost of Fixed assets purchased. The fixed asset does not require special installation charges. For Ex.: freight incurred in purchasing Finished products such as Computer or vehicles as Fixed Assets.
1) What will be the treatment from Accounting Point of view? and
2) What will be the treatment as per Direct Tax Law?
Please help and guide me in this regard.
1) What will be the treatment from Accounting Point of view? and
2) What will be the treatment as per Direct Tax Law?
Please help and guide me in this regard.
12 April 2016
1 Freight incurred for purchasing fixed asset has to be added to the cost of fixed assets.
2 Direct tax law allows such capitalization.
2 Direct tax law allows such capitalization.
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12 April 2016
It needs to be added(capitalised) to the cost of the asset.
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