I am paying rent for my factory. and i do some alterations in the factory which costs me around 15000. wil it be treated as a capital item?
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Fixed Asset
Replies (3)
Any expenditure on material alterations of factory having impact in the form of
- increasing production capacity by increasing
floor space
- increasing life of factory building
- increasing revenue generating capacity in
any mode
can only be capitalised to the building costs. Others ought to be expensed.
Any such amt. is treated as capital if it has an effect which extends to more than one yr. and that which increases the production capacity of the asset.
yes you can do cpitalise subject to said expenditure resulting increasing life of asset.
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