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If company utilize its own equipment during its project, then how equipment costs are calculated/measured/ reported for each project and those cost come under which category? I understand these costs are indirect costs. Because equipment will be used for long term and over number of projects. And the practice is to put this costs under "depreciation" while arriving at company's Profit and Loss Statement. Awaiting your valuable opinions
when higher cost and capital requirments prevail, we always consider alternatives such as equipment swap or lease/rental.
purchasing equipment for a single project is some how problematic as it holds alot of expenditure areas,carrying costs,running costs,and equipment desposal at the end of the project.
using project costing and charging depreciation based on % of usage under indirect fixed costs
deperciation charged for that period in which that equipment is used in the project
alternatively
value of asset when the project start xx
value of asset when the project closed ( xx)
amount charged in the project i.e deperciation xx
Depreciation cost per hour