I. Because the expenditure on routine repair activities cannot be charged to fixed assets. Does not meet the conditions for capitalization of subsequent measurement of fixed assets, should be expensed
Since the daily repair work, in order to enable the fixed assets to maintain the original production capacity to continue to produce or to maintain its original ability to achieve economic benefits, and does not improve the fixed assets inherent production capacity or the ability to achieve economic benefits and the cost of expenses incurred, and such maintenance is recurrent, so It does not qualify for capitalization and cannot be capitalized and is charged to administrative expenses.
Only in the fixed assets for alteration, expansion, renewal and reconstruction, from the substantive improvement and enhancement of the fixed assets of the production capacity or the ability to achieve economic benefits of the expenditure, must be incurred in a larger amount, and is not a recurring general maintenance, which meets the conditions for capitalization of subsequent measurement of fixed assets, and therefore should be capitalized.
Second, the new enterprise accounting standards, "the enterprise production workshop (department) and administrative departments to incur fixed asset repair costs and other subsequent expenditure, also as administrative expenses accounting".
The entry when the workshop fixed asset repair costs:
Borrow: administrative expenses ?
Credit: bank deposits (to pay for the cost of hiring outside personnel to repair) ?
Employee compensation payable
Raw materials, etc. (repaired by the employees of this enterprise) ?
Production costs - auxiliary production costs, etc. (repaired by the repair shop of the enterprise)
Three, the repair of fixed assets need to distinguish between general repair and major repair, general repair is charged to the manufacturing costs, major repairs can be included in the long-term amortized expenses. But one thing to note is that the tax bureau of the tax treatment of major repairs have certain provisions, that is, major repairs need to meet certain requirements:
1, repair costs accounted for more than 50% of the value of the asset;
2, after the repair of the increase in the use of the life of the previous 2 years, or else, the funds for major repairs into the long-term amortized expenses is a tax-related risk.
Management costs class I does not account for any costs of the workshop, management costs only accounting for the company's management costs, the workshop general management costs are included in manufacturing costs.
Expanded:
Specific Items of Administrative Expenses
1. Corporate Expenses
Headquarter management salaries, employee benefits, travel, office expenses, board of directors' dues, depreciation, repairs, consumption of materials, amortization of low-value consumables, and other corporate expenses;
2. Labor Insurance Premiums
The retired workers' pensions, price subsidies, medical expenses (including retirees to participate in the medical insurance fund), relocation expenses, employee severance pay, employee death funeral subsidies, pension payments, the provisions of the funds paid to retired cadres and the implementation of the Social Co-ordination Fund; standby insurance premiums refers to the company's contribution to the standby fund in accordance with state regulations;
3, the board of directors' dues
It refers to the expenses incurred by the supreme authority of the enterprise and its members for the performance of their functions, including travel expenses and meeting expenses.
4, other expenses
The original tax law (repealed on January 1, 2008) stipulates that: enterprises incur business hospitality expenses directly related to production and operation, taxpayers can provide true and effective vouchers or information, within the following limits are allowed to be expensed as expenses, and the portion that exceeds the standard shall not be deducted before the tax: the annual net sales (business) income of 15 million yuan and below, shall not exceed the sales (business) income of 15 million yuan and below, shall not exceed the sales (business) income of 15 million yuan and below. shall not exceed 5 per cent of the net sales (business); the annual net sales (business) of more than 15 million yuan shall not exceed 3 per cent of the net sales of the part.
The current tax law: the implementation of the regulations in Article 43 clearly stipulates that enterprises incurred in production and business activities related to business hospitality expenses, in accordance with the amount of 60% deduction, but the maximum shall not exceed the current year's sales (operating) income of 5 ‰. Sales (business) income including main business income and other business income.
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