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    lealee's Avatar
    lealee Posts: 1, Reputation: 1
    New Member
    		  
    #1

    Feb 27, 2013, 09:44 AM
    Are service contracts for leased equipment considered an expense
    I have three different maintenance contracts for three printing presses (equipment), should the contracts be booked on the gen. ledger as an "expense" or under "equipment"-"Fixed Asset"?
    pready's Avatar
    pready Posts: 3,197, Reputation: 207
    Ultra Member
    		  
    #2

    Feb 27, 2013, 10:55 AM
    It depends on a number of factors like the service life of the equipment and how long you are leasing it for.
    Fidget1's Avatar
    Fidget1 Posts: 105, Reputation: 4
    Junior Member
    		  
    #3

    Feb 27, 2013, 12:11 PM
    Routine maintenance/service costs should be expensed because they don't enhance the asset in any way - they just keep it in good working order and are therefore an overhead in the ordinary day-to-day running of the business.
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