treatment of insurance on new car
This query is : Resolved
Gaurav Jain
(Querist)
14 June 2008
what is the tratment of insurance on a new car purchased during the year?
whether the same is to be capitalised or treated as revenue exp.
if to be capitalised then plase state reason?
gaurav jain
whether the same is to be capitalised or treated as revenue exp.
if to be capitalised then plase state reason?
gaurav jain
Nilesh Damji Chheda
(Expert)
14 June 2008
hi guarav
any expenses paid at the time of purchase of car the same has to be capitalised. insurance , taxes etc paid at the time of purchase has to be capitalised. As per AS - 10 : Accounting for Fixed Assets issued bi ICAI any expense incurred to bring the assets to its present location has to be capitalised
any expenses paid at the time of purchase of car the same has to be capitalised. insurance , taxes etc paid at the time of purchase has to be capitalised. As per AS - 10 : Accounting for Fixed Assets issued bi ICAI any expense incurred to bring the assets to its present location has to be capitalised
Azmathullah Khan
(Expert)
14 June 2008
As per AS - 10, any expenses incurred at the time of purchasing the assets should be capitilised.
Hence Ins., RTA, Fitness, extra fitting, should be capitalised
Hence Ins., RTA, Fitness, extra fitting, should be capitalised
Gaurav Jain
(Querist)
14 June 2008
but insurance is a exp. which we have to bear each year
so its in nature of revene
so its in nature of revene
16 June 2008
Only for first year it should be capitalised..from second year it can charged to p& l a/c
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