Dear Friends,
Usually we will account Insurance as a prepaid expenses for 12 months. Now, we procured tools for machines and its cost is about 1.5Lakh. Is there any provisions for accounting this expenses under prepaid tools for machines? as per INDAS ?
Menu
Prepaid Expenses Accounting for Tools
Replies (5)
Quick Summary
Provisioning in accounts is a general phenomenon
You need to provide for expenses as per prudent accounting concept and " ACCRUAL CONCEPT".
You need to provide for expenses as per prudent accounting concept and " ACCRUAL CONCEPT".
Thanks Sabyasachi Bhai. We procured tools for multiple machines for Rs 100000 on Aug. If we account this value in Aug and our PL will impact. So, shall we account this amount under prepaid and monthly will be accounted 10K for 12 months. For prepaid insurance particular period is mentioned in the policy. But, what about Tools for machines? We account 12 months or need to close within this FY?
Tools are basically a capital item.
But individually an item should be more than 1% of the revenue of the company. Then it should be capitalized.
I
But individually an item should be more than 1% of the revenue of the company. Then it should be capitalized.
I
Actually it includes tools and consumables for multiple machines. So, we can't account this costs for particular machines
Consumables are not capital item.
Recent Topics :
- Taxation of Gift - Father to Daughter
- TDS on Property Purchased above 50lakh
- Accounting Treatment in Tally for Restaurant Sales
- Form 146 required
- Rule 86(B) Applicability
- ROC FILINGS FY2025-26
- Mismatch in 26AS
- How Can a Trader Utilise Approximately ₹1.20
- How Can Law Students Present Papers at Conferences
- On which amount 200% penalty under section 270A is
Related Topics :
CAclubindia
