capitalization

In case of Asset

The definition of the two terms will be as follows.

1. Capitalisation- Charging the value of an asset to the Capital Expenditure and utilising the value of the same with the wear and tear of time by way of Depreciation- it was in simple terms-

2. Where as amooritisation mean charging the asset value to miscellaneous Asset and spreading the benefit over the pre-fixed life of that asset.

Diffrencere

in case of capitalisation- asset value disappears from the balance sheet on the industry prescribed rate- i.e. depreciation rate where as in case of amoritisation the value being charged to revenue as per business policy...

Lets see other views....

Regards,

Bhavik Davda

www.vaibham.com

022-6526 6529

Agree with Bhavik.