Student Question: Why would a cheque for solicitor fees and stampduty on the purchase of land and bu


G

GO

Why would a cheque for solicitor fees and stamp duty on the purchase of
land and buildings not be treated as an expense?

It has been written into the land and building accounts, rather than an
expense, and I am being asked why???

Would have been nice if the text book covered it....

Any help please?

GO.
 
N

New Cassandra

GO said:
Why would a cheque for solicitor fees and stamp duty on the purchase of
land and buildings not be treated as an expense?

It has been written into the land and building accounts, rather than an
expense, and I am being asked why???

Would have been nice if the text book covered it....

Any help please?

GO.
Because these payments are part of the costs of acquiring the capital
asset, not a separate operating expense.
 
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G

GO

So any cost going towards acquiring a capital asset is not an expense.
So broker fees for financial advise for a business would not be an
expense if the broker was advising on an investment?
 
N

New Cassandra

GO said:
So any cost going towards acquiring a capital asset is not an expense.
So broker fees for financial advise for a business would not be an
expense if the broker was advising on an investment?
Spot on. This can get complicated though, as initial advice and ongoing
advice is treated differently for both accounting and tax purposes her
in Australia
 
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G

GO

Thanks for your help.

New said:
Spot on. This can get complicated though, as initial advice and ongoing
advice is treated differently for both accounting and tax purposes her
in Australia
 

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