Tally software purchase

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CA Finalist
74 Points Posted on 22 March 2021
Entry for tally purchased in the books of company. Is it treated as an expense?
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On 22 March 2021 at 17:21 Report
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When purchasing Tally software, it should be treated as a capitalised intangible asset rather than an immediate expense. The cost should be recorded as an asset in the company's books and then amortised over its useful life. If the pattern of consumption cannot be clearly established, Straight-Line Method (SLM) amortisation should be applied.

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My grammar is 💯 good I
7306 Points Posted on 22 March 2021

It is capitalised. 

Tally a/c - asset

To Bank a/c

then it is amortised as per the pattern of consumption. When one can’t establish it, use SLM amortisation.

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On 22 March 2021 at 18:21
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Chartered Accountant
24588 Points Posted on 22 March 2021
Tally software is an intangible asset.

It should be capitalised.
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On 22 March 2021 at 18:34

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