Save Rs 588 on a 2-Year Ad-Free CAclubindia Pro Membership. Subscribe Now!

prelimenary expenses

Save Share

This query is : Open

saurav agrawal (Querist)
Follow

08 December 2016 what is treatment of prelimenary expenses according to scedule 3 and new AS.... if in trial balance if prelimenary exp is 5000 and in other information 1000 rs is given as writeofff. then what we should do

CA Suresh Jain

CA Suresh Jain (Expert)
Follow

08 December 2016 AS 26 deals with intangible assets ;preliminary expenses are also an intangible asset. The period in which preliminary expenses are to be amortised can be decided by the judgment of the directors of the company. As per AS 26 suggestion it is a period of 10 years , it is not biding , a different period is permissible if it is justified in the opinion of the management. Company can write off preliminary expenses in the year it starts activity. Company can add the Preliminary expenses in the Fixed assets in the ratio of cost of the assets also

You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now