Explain about Capitalization of Internal, External Asset?

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  • Sep 15th, 2010

Asset becomes capitalised when it is bought for profit motive, as an investment, and most important : when it is used.
Asset available within an organisation - Internal Asset.
Asset where they are present physically out of organisation - External Asset.

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  • Sep 21st, 2010

Internal Acqusition of an asset means, when an asset is built inhouse by creating an AUC(Asset Under Constuction), and then once the assets is fit to use for Production, its get capitalized as Completed Asset.

In case of external acqusition, the Completed asset will be put into use and it will be in operation, the time it is purchased.

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