Hi All,
Kindly guide me on my queries relating to purchase of a software through loan.
For Example A Ltd wants to purchase a software costing Rs.1 crore from a vendor.Due to non-availability of funds the company decides to pay the vendor the price in 60 equated monthly instalments.Can this be done as the vendor is not a Hire purchase or a Leasing company? Whether i can make a loan agreement with the vendor to consider the cost of the asset as a loan which shall be repaid month on month along with interest over a fixed tenure?
Which option will be better to show in the books of accounts a) Lease or b) Loan ?
Thanks in advance for your views.
CAclubindia
