Treatment for payment of insurence at the time of purchase

It will be debited to Prepaid A/c & treated as an other current asset.  After that the amount pertaining to teh F.Y. would be debited to Insurance a/c & the balance would be c/f.

The 1st premisum paid shall be treated as Capital Expenditure. Whereas the next premiums paid can be debited to Profit and Loss Account.

Regards,

Devendra Kulkarni

it is a capital expenditure.... angreed with Devendra

its is revenue expediture n should be trf to p&L a/c 

first insurance will be capitalised to the cost of vehicle....and all other will be debited to profit and loss a/c