Accounting for Fixed Asset

I think this liquidated damages charged from supplier, and no need to reduce from cost. 

According to AS 10 Recognition in case you have purchased assets should be as below:

           Purchase Price                     xx

           Taxes (non refundable)        xx

           Transportation Charges        xx

           Installation Charges             xx

           Trial Run Exp les income    xx

            Borrowing Cost - AS16        xx

    AMT. TO BE CAPITALISED:      xx

Net amount payable by you will be Contract Price - Liquidated damages, i.e. purchase price, so it should be deducted.

Hope I succeed to satisfy you.

Thanks & Regards

Sourav

Dear sivaram,

you've uploaaded file by name "Components of Cost of Fixed Assets". and in

that you have mentioned "incomes which reduce the cost" should be deucted from the total cost.

Referring the above,you'll raise debit note to the vendor for the liquidated damages and pay the balance amount.

While capitalising the asset , this amount of liquidate damages should be reduced from the total cost.This is same as that of the reduction of the subsidy amount from the cost of asset.