Please Help: Accounts

Posted Date : 26-May-2012 , 02:41:13 pm | Posted By Rinkle Mahajan

Accounting traetment for renewal for domain name & web hosting expenses, whether these are revenue exp. or it should be capitalised

Category : Audit | Answers : 3 | Comments : 1 | Hits : 217

Answers

Answer By: RICHI SAXENA

These expenses should be treated as Revenue expenses because these are incurred on annual basis and have an affect on the profitability of the company for over a year only.
CA.Richi Saxena

Answer By: Rishabh Upadhyay

Hi, the answer to your question will depends on the nature of your business. In case it is a normal website just to market your brand name and and provide relevent information to the prospect clients then the annual expenditure will be charged as revenue. However in case your business is one of a kind like internet selling website, then even though the expenses are charged on annual basis still, website being an important tool to develop your business, any expenditure incurred on the same will be charged as capital expense as it build your goodwill and brand name.

Answer By: Vikash Kumar Jha

I am completely agree with Rishabh Sir.