Treatment of fixed asset in cash basis of accounting

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Querist : Anonymous

Querist : Anonymous (Querist)

11 July 2011 I wanted to ask that how fixed assets will come in the Balance sheet since it has to be expensed out in the Profit & loss A/c in the year of purchase under cash basis of accounting?

CS VENKATARAMANAN S

CS VENKATARAMANAN S (Expert)
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11 July 2011 Fixed Assets will not be treated as expenses on any type of accounts. They are directly debited in fixed assets account. not in the expenses account.
regards..

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Querist : Anonymous

Querist : Anonymous (Querist)

11 July 2011 Hi,But in pure cash basis of accounting, it can be treated as an expense.....Also, cash basis doesn't distinguish b/w revenue & capital items. please throw some light on this

CMA Ramesh Krishnan

CMA Ramesh Krishnan (Expert)
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17 July 2011 Even cash basis or mercantile basis the accounting principles are same. the concept of revenue and capital will not affect that

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