Whether expenses made for renovation work in huge amount for building and other infrastructure which was destroyed in fire last financial year to be capitalised or to be charged to P&L?
Somaas Kandan (CA Final) (385 Points)
12 June 2011Whether expenses made for renovation work in huge amount for building and other infrastructure which was destroyed in fire last financial year to be capitalised or to be charged to P&L?
CS,CA F,Numrologi TusharSampat
(CS CA F Numerologist Astrologer Graphologist Face reader Vastu Expert)
(85930 Points)
Replied 12 June 2011
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.
Devendra
(Chartered Accountant)
(4775 Points)
Replied 12 June 2011
CAPITALIZE THE EXPENDITURE AND CLAIM DEPRECIATION.
REGARDS,
DEVENDRA K
sricharan
(IPCC student)
(23 Points)
Replied 12 June 2011
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
Vijay
(Adamo Studio)
(2112 Points)
Replied 13 June 2011
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
Shivani Dhoble
(Accounts Executive)
(26 Points)
Replied 13 June 2011
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.
Devang Gajjar
(Chartered Accountant)
(41 Points)
Replied 13 June 2011
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.
Sumit Kumar
(Audit Executive)
(278 Points)
Replied 13 June 2011
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!!!!!!!!!!
Prakash Ramani
(B.com,CA)
(276 Points)
Replied 13 June 2011
it should be capitalised because it will results in further benifit to the entity.
CA Aditya Modi
(Associate Manager)
(159 Points)
Replied 13 June 2011
It should be capitalised as these expenses are made to give continuing benifits. Thus AS 10 is applicable
naga kiran kumar
(Articles Completed)
(78 Points)
Replied 13 June 2011
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.
CS Bijoy
(Expert)
(6394 Points)
Replied 13 June 2011
According to me any expenditure incured on Fixed Asset increased the life of the asset will be capitalized.
Vikash Kharvar
(Dy. Manager -F&A)
(469 Points)
Replied 13 June 2011
| Originally posted by : sricharan | ||
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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 |
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