LIVE GST Certification Course by CA Arun Chhajer begins 27th April. Register Now!!

Repairs and maintainence

raj shome (Student CA Final ) (62 Points)

20 March 2013

can purchases of materials made for repairing purpose be taken under the head "repairs and maintainence"?

Reply
Follow
Share

2 Replies

Milind M. Kulkarni (Practicing CA) (580 Points)
Replied 20 March 2013

It is a common practice among companies to show it under Purchase of maintenance materials. Consumption of these materials (opening balance + purchases - closing balance) it treated as Repairs and Maintenance cost. Balance of materials at the year end is shown under inventories (closing stock) under consumables and stores.

1 Like

DEEPU HN (Student CA Final ) (80 Points)
Replied 20 March 2013

if material purchased for the imrovment of Fixed assets that will be taken under the fixed asset (if addition is helps in increasing the production activity beyond the normal activity) , if material used in normal production or recurring activity that will be taken under profit and loss account.

1 Like