in hotel industries if concern asseessee having hotel property on rent agreement and concern assessee made expenses on furniture fitting. addition in such property ..!!! so my query is accounting treatment of such exp ...!! whether i have to book as revenue .. or capitalized such exp..!!! if i have to capitalized then how ..? because i have such hotel building property on rent ..!! i hope i will get correct answer from experts and my senior ..!! thank's
I think you cannot charge to revenue as all the expenses are in capital nature. Movable fixed assets lik furniture has to recognize independently and depreciate over the life of the asset specified in companies act 2013. Immovable assets lik fittings etc has capitalise under the category leasehold improvements and depreciate over the tenure of lease agreement.
18 February 2016
thank you sir but hotel property is on lease and lock in period is 5 year , spend heavy exp for set up restarent fitting and furniture (non movable ) and other shed construction work is done after taking on lease. paid by tenant .
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