Anyone can tell me company bought a Sonic firewall (software) costing Rs. 70,000 with economic life of 3 years which is mentioned by vendor in their invoice and company has booked all 70000 in the year of purchase in profit & loss account instead to defer or other
now i want to know what should be the accounting treatment whether it should have been comes under As 26 Intangible assets and amortised over three years of life or any other accounting treatment will be permissible
13 February 2013
Softwares will form part of AS 26 Intangible assets and have to be depreciated over a period not exceeding 3 years. If this software fulfills the useful definition relative to the industry, then it should be amortised.
CAclubindia
