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treatment of pre operative expenses

Others 1211 views 1 replies
Please tell me the adjustment of pre operative expenses in books of a corporate assessee. The assessee is having pre operative epenses such as salary, electricity, other Expenses amounting to Rs. 53.40 Lacs which are incurred prior to the operation of business.the Co. has intended to write off this in 10 yr i.e 1/10th evry yr.So, please suggest me wht is the appropriate treament of pre operative expenses in books of accounts as per IT or Company Law??? can we capitalised the same in ratio of building & Machinery!! Pls revert ASAP. Regards; Risha
Replies (1)

Capitalise these preoperative exp (Deffered Exp) till the business commences ,after commencement you can w/o it in 5 or 7 years.


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