As-13 doubt

CA Ashish Pathak (Employed at Cipla Ltd.) (2779 Points)

20 June 2013  
Hello Caclub, We all know that long term investments are valued at cost. Now I am confused about valuation of investments in mutual funds. My query is that in case of mutual funds, several times dividend is reinvested. In such cases how should it be valued? Should it be valued at cost only or should we also capitalise the amount of dividends reinvested. Your advice will be highly appreciated. Please help. Regards, Ashish Pathak