Accounting treatment of fixed assets

Whether mobile purchased by a company for its employees be treated as assets or as expenditure ?

The query should be in scene where a company purchase mobile phones ranging from Rs. 1000 to Rs. 65000 for its employees.

Replies (2)

Mobile Handsets are Capital expense in nature hence it has to be capitlized and depreciation is to be claimed as per companies act

 

however as per depreciation schedule of Companies act, any asset costing below 5000/- can be depreciated @ 100% in the year of purchase.

 

Thanks for the reply,

Problem is not of companies act, companies act provide that a higher depreciation may be charged in such a way that 95% of value is written off during its life and mobile phone's life is hardly 2-3 years.

Problem persist in the treatment under IncomeTax.

Does Income Tax department treat moile phone of any value as expenditure, or allow higher depreciation on mobile phone

 

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