ACCOUNT INCHARGE - GUJARAT REGION
98 Points
Joined August 2012
The cost of an item of fixed asset comprises its purchase price, including
import duties and other non-refundable taxes or levies and any directly
attributable cost of bringing the asset to its working condition for its intended
use; any trade discounts and rebates are deducted in arriving at the purchase
price. Examples of directly attributable costs are:
(i) site preparation;
(ii) initial delivery and handling costs;
(iii) installation cost, such as special foundations for plant; and
(iv) professional fees, for example fees of architects and engineers.
Plz refer above para.
As per my knowledge and believe, Purchase Cost= Purchase price + Stampduty + Registration Fees( if it is nonrecuring).
When you sell then your gain from sale of fixed asset= Relization received- ( cost of purchase-accumelated dep on it till date of sale in case of companies at prescribed rate).
Above is tretement For Accountng purpose only.
For Income tax purpose it will as usual
NAR (Sale price - Trf Expenses) - (PC after Indexation),. Indexation of purchase cost in case sale after three year and no indexation if it sale is less then three years from purcahse.
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