Go AD-Free with CAclubindia PRO for Rs 167/Month Only. Subscribe Now!

Expenses for approval

A/c entries 446 views 2 replies

Satvir Singh

Newly minted CA

1733 Points Joined July 2009

A co applied for export of medicines. To what account, should the application fees be debited and should bank charges for draft of same and postage charges be charged to same account, and what should be its treatment. Should it be capitalised? If yes, under what head?

Replies (2)

Ashish Chhawchharia

Chief Manager Finance

38 Points Joined May 2011

Any expenditure specificaly incurred for export, should be booked in separate account head, which may be-" Export sale expenses".

Guest

If the expense is substantial/considerable it has to be capitalised and written off yearly on an equitable basis.(If the license is valid for a certain period,then it has to be amortised over that period)

If the expense is minimal/negligible it may be written off.

when the head of the account is concerned it may be "Export Business Expenses"