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Treatment of vehicle used for demo/exihibition


shanavas (CA)     27 March 2018

shanavas
CA 
 29 points

| My Other Post

A Company dealing in vehicle, uses a vehicle for demo or exihibition purpose in their showroom. The vehicle is kept as demo piece fro almost 4 years and they will not use the vehicle for any other purpose than keeping it as demo piece. What should be the correct treatment of such vehicle in books of accounts. Capitalizing as non current assets and claim depreciation?? 

Please clarify and thanks in advance

 

Shanavas

avater

Rohit jain (Chartered Accountant / Company Secretary)     30 March 2018

Rohit jain
Chartered Accountant / Company Secretary 
 10 likes  216 points

View Profile | My Other Post

since the vehicle is there for 4 years already and there is no use from it in future...if it was earlier capitalized..it's better to write it off

avater

satish (teaching)     30 March 2018

satish
teaching 
 150 likes  1988 points

View Profile | My Other Post

YES IT CAN BE CAPITALISE. SITUATION IS SATISFYING THE DEFINITION OF ASSET UNDER AS-10 PROPERTY, PLANT AND EQUIMENT.


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