Accounting treatment for tally purchase software

Quick Summary
Tally software with 1-year license can be treated either as software expense (revenue expenditure) or intangible asset depending on accounting policy. Many treat it as prepaid/software expense and amortize over the license period, while some classify it as intangible fixed asset.

Because It won't add on value of asset

any software purchased that will come under fixed assets because software has resale value ,later we can sale it to other company or persons or we can earn money .So,This will come under fixed assets

 

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