Hey one factory has completed more than 60% of the compound wall in 3 years. They want to capitalise it. Can they do it?? Balance 40% is pending.......
CA. Kuldeep Singhi (Entrepreneur) 17 February 2014
I think till the time the 40% get completed it should be shown as WIP & then it should be capitalised & depreciation should be charged on it.
Manoj Mehta (Head Of Department (Accounts & Finance)) 03 March 2014
Kuldeep is correct but there is another way of capitalising it.
You can show it as completed boundry wall (For 60%) in the current year and you can treat the rest 40% as addition to completed boundry wall in the next year. Hence you will be able to take the benefit of Depriciation in your accounts from current year itself.
I hope it will help you
Regards to you