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Fixed asset purchase expense

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1359 Points Posted on 05 May 2022
expense (wage for installation , trasport etc) incurred in purchase of fixed asset journal entries
2- can debit wage a/c and then tranfer the balance to asset a/c ??
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On 05 May 2022 at 14:20 Report
Replies (6)
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CFO- at NHTF
58280 Points Posted on 05 May 2022
Yes.All incidental expenses shall be added to cost of PPE
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On 05 May 2022 at 16:28
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Profession Business
28207 Points Posted on 06 May 2022
All expenses incurred incidental to bringing the asset to its working condition has to be capitalized. So it's put to use.This is as per ICAI GUIDELINES AND ACCOUNTING STANDARD.
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On 06 May 2022 at 06:13
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CFO- at NHTF
58280 Points Posted on 06 May 2022
Directly account wages, transportation exp as PPE

PPE a/c Dr
To Bank
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On 06 May 2022 at 07:29
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1359 Points Posted on 06 May 2022
Can we also do this as
wages a/c dr 1000
to cash a/c cr 1000

Asset a/c dr 1000
to wages a/c cr 1000
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On 06 May 2022 at 10:39
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CFO- at NHTF
58280 Points Posted on 06 May 2022
Yes.It can be done .

Final effect is

Asset(PPE)
To Cash/ bank
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On 06 May 2022 at 10:44
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Chartered Accountant
5010 Points Posted on 06 May 2022

You can debit all teh expenses to the particular Fixed Asset. 

All these expenses are directly linked to the fixed assets

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On 06 May 2022 at 12:59


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