AA-50-In Which Account Purchasing of Fire Extinguisher for office Use Will be Recorded.

Dear All Respected Members,

Hope all of you will be fine with good health and doing well.

Please educate me if we purchase a fire extinguisher for office use for 1year validity which will be refilled for next 1 year, in which account, will it be recorded ? Will it be recorded as current assets or expense ? If it is recorded as current assets, what will be entry on completion of 1 year ?

Thanks in advance for your precious time and efforts to reply this query. 

 

Replies (8)
Quick Summary
This discussion explores the correct accounting treatment for office fire extinguishers. Participants debate whether to record them as a fixed asset or an expense. The consensus leans towards classifying the initial purchase as a fixed asset, with refilling costs treated as indirect expenses. Depreciation is also discussed, with a suggested rate of 15% if treated as a fixed asset.

The Fire Extinguisher will be account under Fixed Asset...

After completing a year then the refiling will be account under Indirect Expenses...
Originally posted by : RAJA P M
The Fire Extinguisher will be account under Fixed Asset...After completing a year then the refiling will be account under Indirect Expenses...

Dear Raja PM Sir,

Thanks for your informative reply.

Please educate me if we record it as fixed assets, will depreciation will charge on it ? If yes then, what will be the rate of depreciation? 

Kind response awaited from Raja PM Sir.

If you dont have to return back the cylinder its a fixed asset. Otherwise itll be stock at hand because there is no asset that you have purchased. However, government compliance suggests that it is mandatory. 

Dear Yassawi Gomes,

Thanks for your reply.

please let me know can we expense it out ?

Since it's renewal and if you have to return the container

Dr. purchase

Cr. Bank

Next year the same entry

If you get to keep the container

Dr. Fire extinguisher

Cr. Bank

Next year

Dr. Refill expense

Cr. Bank

Originally posted by : My Videos



Originally posted by : RAJA P M



The Fire Extinguisher will be account under Fixed Asset...After completing a year then the refiling will be account under Indirect Expenses...





Dear Raja PM Sir,

Thanks for your informative reply.

Please educate me if we record it as fixed assets, will depreciation will charge on it ? If yes then, what will be the rate of depreciation? 

Yes, Depreciation is applicable @ 15%

Originally posted by : RAJA P M



Originally posted by : My Videos






Originally posted by : RAJA P M



The Fire Extinguisher will be account under Fixed Asset...After completing a year then the refiling will be account under Indirect Expenses...





Dear Raja PM Sir,

Thanks for your informative reply.

Please educate me if we record it as fixed assets, will depreciation will charge on it ? If yes then, what will be the rate of depreciation? 





Yes, Depreciation is applicable @ 15%

Dear Raja PM Sir,

Thanks to share depreciation rate. 

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