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Preliminary expenses are which account?

1.Real Account2.Personal Account3.Nominal Account4.Non of theses

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Question added by Dasarathi Rath , Sr. Accountant , Al Luban Special Investment LLC
Date Posted: 2016/03/07
Nijo Johnson
by Nijo Johnson , Assistant Manager , Deloitte and Touche

Ideally preliminary expenses (I assume you mean start-up or pre-operating costs) should be expensed as incurred as per IAS 38.69.

 

In case you are not reporting as per IFRS it is a Real account.

 

Good day!

Frank Mwansa
by Frank Mwansa , ACCOUNTING LECTURER , FREELANCER

The benefit  of preliminary expenses is long term so it is treated as intangible asset and are shown in balance sheet.. So the correct account is Real account.

Shahbaz Hayder
by Shahbaz Hayder , Group Head of Finance , Sharif Group of Companies

As per IAS- Nominal Account.

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