Capitalize or not

IF THE OTHER INFRASTUCTURE WAS TOTALY DESTROYED BY FIRE AN

AT ALL  EXPENSES  ON  NEW ONES WERE MADE THN IT WILL BE

CAPITALISED .

BUT FOR BUILDING MORE INFO IS REQ FOR PERFECT OPINION.

CAPITALIZE THE EXPENDITURE AND CLAIM DEPRECIATION.

REGARDS,

DEVENDRA K

yes it should be capitalized                            

must be capitalized  

The extent to the insurence amount recived to be capitalized and remaining charge to p&l a/c as miscellinous expenses to the extent writtten off

Amt of expenditure is not at all a criteria for nature of exp

It is only that a new asset is generated/ increased part capacity/ pro cot decrease

Expenses made for renovation work in huge amount for building must be capitalised as it will be there for years long.....

and other infrastructure which was destroyed in fire last financial year is to be charged to P&L account with the amount of expenses & the remain left out portion can be capitalised or charged to P& L depending upon the value of amount.

As per AS-10 on "Fixed Assets", if any expenditure has increased the efficiency or useful life of the asset then it must be Capitalized and if not then charge it to P&L A/c.

In my opinion it will be charged to P & L A/C as the expenditure incurred is for bringing that building to its same position as it was before the destruction.

It should have been capitalised if that renovation work lead to increase in the usefull life of the asset..

PLZ CORRECT ME IF I M WRONG!!!!!!!!!!

it should be capitalised because it will results in further benifit to the entity.

It should be capitalised as these expenses are made to give continuing benifits. Thus AS 10 is applicable

If the asset was partially destroyed and the expenditure is incurred to bring the asset to its original working position, it is to be charged to P&L A/C

If the asset is fully destroyed, then the expenditure incurred is to be capitalised.. since it means creating completely a new asset.

According to me any expenditure incured on Fixed Asset increased the life of the asset will be capitalized.

Originally posted by : sricharan
	The extent to the insurence amount recived to be capitalized and remaining charge to p&l a/c as miscellinous expenses to the extent writtten off

 it is right in my view also .......