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i have a water bottling business. i supply 5 gallon water bottles to my customers. basically the bottles are my property. i am only selling the water. the cost of one bottle is around 17 Rs. and I am assuming that one bottle can be refilled only upto 30 times. so for costing purposes I have taken the bottle cost to be 17/30 = Rs. 0.57. actually i want to treat these bottles as a current asset and want to amortise its cost .
plz tell me the treatment to be done in P/L a/c & balance sheet. |
When you buy the bottles you can pass the following entry Packing Material A/c Dr. Bank A/c Cr. At the end of the year, whatever amount becomes due for writting off, you can pass this entry Packaging A/c Dr. Packing Material A/c Cr. The packaging account will be shown in the P & L A/c while the balance left in the Packing Material A/c will be shown in Balance Sheet under the Current Assets.
thanks for the solution your experience really helping us.
thanks a lot jag sir.
thanks jalpesh for bringing my problem to jag sir
CAclubindia
