Government subsidy

739 views 4 replies

Hi,

A person is running A business and it had received Govt susbidy on total project cost.

As per AS-12, in case of company it can be shown as Capital Reserve.

However, what will be accounting treatmnet in case of sole preprietorship firm, whether it should be shown in Liability side of B/S only?

Replies (4)

Hello,

is it monetary or non monetary,

 

in my opinion,

 

it should be adjusted against CAPITAL ASSETS

If it is monetary subsidy then,  it will be deducted from total Cost of assets and we will charge depreciation on net amount only.

The subsidy is on total cost of project and is nt on particular asset. so I dnt think that it should be deducted from cost of machinery

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