Which of the following costs incurred subsequent to the acquisition of machine would be appropriately accounted...
Which of the following costs incurred subsequent to
the acquisition of machine would be appropriately accounted for by
debiting the accumulated depression account related to the machine
.
a. the cost of cleaning and lubricating the machine.
b. the cost of overhauling and extending the life of the
machine.
c. the cost of moving the machine to another manufacturing
plant.
d. the cost of new attachment to the machine that provides for more
output per unit of the time.
Homework Answers
Following cost would be Capitalised
1. (b) & (d) because in one case useful life of machinery is increasing and in other output is increasing
2. (a) & (c) won’t be capitalised because they are revenue expense in nature so they are to be accounted as revenue expense
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Which of the following costs incurred subsequent to
the acquisition of machine would be appropriately accounted...
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