Office renovation expense is capital expenditure......?

Is rental office renovation expense is capital expenditure.....?

If it is please explain and their journal entry

Replies (6)

it is capital expenditure 

pass entry under fix asset head 

entry for purchase of cement for construction for rs 50000/-

cement   50000/-  (cement come under fix asset head )

   To party ac    50000/- (from whom u purchase )

whatever applicable for construction u need to capilist it 

even professional charges also for concern thing 

Any expenditure the benefit of which
Any expenditure the benefit of which enjoyed by the business for more than one year then it is known as capital expenditure .
In your case if office renovation expense is incurred for office building and the benefits from such expenditure is enjoyed for more than one year then it has to be capitalized to the buildings account ( buildings cost would increase)
journal entry would be

buildings. A/C. dr. xxx

TO Cash. A/C xxx
if building has taken on rental basis then
it should not be capitalized , because it is not your building , in such case expenditure should be treated as
1) revenue expenditure
office expenses dr
To. cash
( or )
2) differed revenue expenditure
in such case expenditure should be written on the assets side and it should be write off over the period the business earns benefits from it , journal entry would be same , along with that expenditure relating to that particular year should be adjusted as follows
profit/loss account
to office exp
May I know for the accrued renovation how is going to put the journal entry? In this case, The company is estimate the cost of renovation on a building

hi office renovation under which head?  and gst credit shall we avail ?

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