Should we consider Spark Mate Magic clening Mop under Office Equipment ???
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Fixed assets
Replies (10)
If its value is less than 5000..(which i suppose it is)....book it under Misc and general expenses...no need to show it as an asset.
Can we consider it under consumables.....its value is Rs.1999
Hi Dude,
For including any expenditure under 'Assets', such expenditure must satisfy conditions of being 'Capital Expenditure'. Furthermore, it should result in increase in profit earning capacity.
In none of the way I found any reason to include above under Assets. Hence, right way is to show it under P&L.
No..its not an input........book it under misc and general expenses.
| Originally posted by : Suryakant Dubey | ||
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Can we consider it under consumables.....its value is Rs.1999 |
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Anything that gets used up by your processes is a consumable. For example, a magazine printer would have paper and ink as consumables....so its not right to book it under consumables.
i agree with all...but i need a reference from which i can convince my client for such consideration....
Refernce??...juss tell him you can only show fixed assets as office equipments..and this mop doesnt satisfy any condition of fixed asset.....further its value < 5000..so no need of depreciation too....obv u wont get any case law on these petty matters.
Materials consumed would consist of raw materials, packing materials (where
classified by the company as raw materials) and other materials such as
purchased intermediates and components which are ‘consumed’ in the
manufacturing activities of the company.
Therefore, the purchase of the cleaning mop cannot be accounted under "Consumables". Neither can it be classified as a "Fixed Asset" as it is not held with the purpose of producing goods or rendering services.
You have to classify it under Miscellaneous expenses. If you have an expense account as "office maintenance expenses", that would also do.
Mr. Suryakant,let me remind you also
-There is no concept of Rs.5000/- in Income Tax Act i.e if value of Mop is Rs.2000/- then also it has to added in block of Assets.
- In Companies Act ,if value of Asset is less than Rs.5000/- then you have an option to charged it to Profit & Loss A/c.
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