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Sir,
Suppose we have a bussiness of air conditioners….now we hv decided to open a new store where we would use those air conditioners in tht new store. How would we treat this. Wht wld the entry be
We would no longer count them as inventory and instead would capitalise them as fixtures and fittings
Does that do it for you?
Sir what if the air conditioners are of insignificant amount (compared to the new store they are of very less value) wld we still capitalise ? On wht basis do we decide whether to capitalize or not ??
Entity policy!
Do all entities capitalise calculators that they buy for the use of their staff?
Each separate entity will have its own capitalisation policy where items of a capital nature (calculators?) are not capitalised if they are less than, say, $1,000
But it’s an individual matter for individual entities
OK?
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