1.Whether premium paid by option buyer at the time of option buying shall be capitalized to the cost of investment if option is exercised and physical delivery is taken. OR Should be debited to P&L A/c.
Plz reply fast
C.A. LINESH PATIL (CA) (910 Points)
29 September 20101.Whether premium paid by option buyer at the time of option buying shall be capitalized to the cost of investment if option is exercised and physical delivery is taken. OR Should be debited to P&L A/c.
Plz reply fast
Harsha
(Chartered Accountant CS (Final))
(227 Points)
Replied 29 September 2010
May be we need to capitalized. Because, if we paid commission for purchase of Investment securities. We will add it to the cost of the investment. Same way premium paid can be treated.
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