Miscellaneous expenditure and p % l a/c (dr)
This query is : Resolved
11 January 2013
Query:
Regarding miscellaneous expenditures, 12th class TS Grewal book (supplement- preface- silent feature page) says that Unamortised portion of Miscellanous expenditures MUST either be adjusted against securities premium account
or debited to statement of profit and loss.
Some other books and NCERT supplement guidelines say that: The unamortised portion of such expenditures should be shown under "Other current assets" or "Other non current assets" depending on whether they will be amortised in the next 12 months or thereafter.
These two methods seem to be contradicting each other.
Which of the above methods is right. Can we call both of them right Please also suggest some study material (book) to get more clarificaiton.
Thanks in advance
Regarding miscellaneous expenditures, 12th class TS Grewal book (supplement- preface- silent feature page) says that Unamortised portion of Miscellanous expenditures MUST either be adjusted against securities premium account
or debited to statement of profit and loss.
Some other books and NCERT supplement guidelines say that: The unamortised portion of such expenditures should be shown under "Other current assets" or "Other non current assets" depending on whether they will be amortised in the next 12 months or thereafter.
These two methods seem to be contradicting each other.
Which of the above methods is right. Can we call both of them right Please also suggest some study material (book) to get more clarificaiton.
Thanks in advance
11 January 2013
Dear Friend, According to Changed Schedule VI , the Micellaneous expenditure should be show as a part of Other Current Assets or Other Non Current Assets depending on its period of amortisation. Thanks
11 January 2013
Both are correct:
1.Preliminary expenses and commission paid or discount allowed on, any issue of shares or debentures of the company, premium payable on the redemption of any redeemable preference shares or of any debentures- can be adjusted against to the extent of security premium.(Sec.78 of companies act)
2.Balance and others should be shown under current or non current assets.
1.Preliminary expenses and commission paid or discount allowed on, any issue of shares or debentures of the company, premium payable on the redemption of any redeemable preference shares or of any debentures- can be adjusted against to the extent of security premium.(Sec.78 of companies act)
2.Balance and others should be shown under current or non current assets.
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