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Preliminary expenses are changed to expense in the year in which they are incurred
or
Amortized over a period of time.
AGREE WITH MR MALIK ANSWER
The benefit of the preliminary expenses is long-term so it is treated as intangible asset and shown in Balance sheet under Missilinous assets. These expenses will be written off in5 equal year installment in profit and loss A/c.
I agree with Malik that the preliminary / initial expenses are amortized by the period over the time (as guided by the accounting standards)
preliminarily expense wiped off share premium Account
