Under PAS 16, when accounting for plant, property, and equipment, a company: O May elect to use the cost model or the revaluation model on any asset class O Either A, B or C O May elect to use the cost model or the revaluation model on all PPE assets O May elect to use the cost model or the revaluation model on any individual asset
Q: According to FASB Statement No. 34, interest must be capitalized for a. Assets that are ready for…
A: FASB Statement no. 34 provides provisions related to capitalization of interest costs on borrowings.…
Q: 4. Historical cost is the basis advocated for recording the acquisition of property, plant, and…
A: Historical cost principle: This is an accounting principle which states that the actual cost paid in…
Q: Under IFRS, which of the following statements describes the fair value model for accounting for…
A: Investment Property: Investment properties are those which generate income in the form dividends,…
Q: Which of the following statements is/are true concerning property, plant and equipment (PPE)? I. PPE…
A: Property, Plant & Equipment: These are the Company's non cash, long term, physical or tangible…
Q: Sheldon Crop wishes to use different depreciation methods for the major classes of property, plant,…
A: As per IFRS, a company should depreciation method which reflects the pattern of economic benefit…
Q: If a company uses the fair value model to value investment property, changes in the fairvalue of the…
A: Under the fair value model, remeasuring of investment property is made at the end of each reporting…
Q: According to IFRS, all of the following pieces of information about intangible assets mustbe…
A: Intangible Assets are measured based upon classification as assets with a finite life or assets with…
Q: Under IFRS, when an entity chooses the revaluation model as its accounting policy for measuring…
A:
Q: Which of the following is not included as part of the cost of an item of property, plant and…
A: Property, Plant and Equipment refers to All fixed Asset having long useful life more than One year.…
Q: For borrowing costs to be capitalized as part of the cost of a qualifying asset, the following…
A:
Q: 5. According to PAS 38 Intangible Assets, if an entity cannot identify in which phase a cost is…
A: "Since you have asked multiple question we will solve the first question for you. If you want any…
Q: What is the criterion a company uses to decide whether to include an expenditure in the cost of…
A: The criterion used by a company to include a cost in the cost of an asset is whether it is necessary…
Q: When does the cost of land affect an entity's profit or loss? * O When the related revaluation is…
A: The Fixed assets and Investments that are long term in nature i.e. full value of the asset cannot be…
Q: If an entity recognizes in the carrying amount of an item of property, plant and equipment the cost…
A: Derecognition:- If an entity recognizes in the carrying amount of an item of property, plant, and…
Q: Accounting for plant assets involves cost determination, depreciation, additional expenditures, and…
A: International Financial Reporting Standards (IFRS) They are commonly known as IFRS. It is a set of…
Q: Question Content Area According to GAAP, interest cost incurred to finance construction of an asset…
A: 1) The period of capitalization should end when the asset is ready for intended use. 2)when the…
Q: Which of the following is/are not capitalized as an intangible asset?
A: Step 1 As per intangible assets, in business combination we separately identify the intangible…
Q: nder IFRS, disclosure for an investment property must include which of the following
A: The investment property is the property that is held with an intention to earn rental income. It…
Q: According to IAS 38 Intangible Assets, which of the following types of research and development…
A: According to IAS 38 Intangible Assets, which of the following types of research and development…
Q: Which of the following statements are correct? I. Borrowing costs incurred in the acquisition,…
A: Answer is Option c) Both I and II
Q: Which statement on property, plant and equipment (PPE) is true? * a. PPE items may include…
A: The assets of the company will provide the future economic benefits for the company. If the company…
Q: All of the following are true regarding the revaluation model allowed under GAAP except;
A: The revaluation model gives a business the option of carrying a fixed asset at its revalued amount.…
Q: Which of the following is not a characteristics of an asset that us classified as property, plant…
A: Note: As per the policy, we are supposed to solve one question at a time. Kindly repost the…
Q: Which is not within the definition of an intangible asset? A resource from which future economic…
A: Unlike tangible Assets these Intangible Assets are difficult to valuate
Q: Objectives of the fixed asset system do NOT includea. authorizing the acquisition of fixed assets.b.…
A: Answer: Option d.
Q: Under IFRS, a company that acquires an intangible asset may use the revaluation model for subsequent…
A: IFRS Policy International Financial Reporting Standards (IFRS) refers to the common set of rules and…
Q: Tajam Bhd has a subsidiary meeting the criteria of MFRS 5 to be classified as held for sale. This…
A: Financial implications can be defined as the resultant decision which arises out of the decision…
Q: The cost of an item of property, plant and equipment includes all of the following, except Purchase…
A:
Q: If the entity uses the fair value model for investment property, which statement is true? a. The…
A: Fair value of investment property means value at which property can be exchanged in open market.…
Q: In all cases, net property, plant and equipment (PP&E) should be calculated as the gross PP&E less…
A: Solution: Gross PP &E = Cost of purchase of PPE Accumulated depreciation = Depreciation…
Q: PAS 16 requires that revaluation surplus resulting from initial revaluation property, plant and…
A: Solution: As per requirement of PAS 16, Increase in value of PPE, will be recognized in books by…
Q: For entities that report using IFRS, how are exploration and evaluation assets subsequently…
A: Upon Initial recognition in the statement of financial position, exploration and evaluation assets…
Q: Statement I: An internally generated goodwill shall not be recognized as an intangible asset.…
A: Intangible Assets: It is a recognizable non-financial resource without actual substance.. An asset…
Q: Which statement is incorrect regarding “components depreciation”? a. Each part of an item of…
A: Component depreciation is a type of depreciation which is charged on the components of the fixed…
Q: Costs associated with various intangibles of a company may either be expensed when incurred or…
A: Intangible assets are the asset of the company that cannot be touched or felt but these assets are…
Q: One of the main differences between U.S. GAAP and IAS/IFRS is the measurement of property, plant &…
A: IAS 16 deals provides a framework for accounting treatment of property plant and equipment. The…
Q: Choose the correct. Under IFRS, when an entity chooses the revaluation model as its accounting…
A: When an entity chooses the revaluation model as its accounting policy for measuring property, plant,…
Q: Which statement below regarding the accounting for intangible assets is correct O Patents are…
A: Analysis of opinions 1. Patents are amortized over the shorter of useful life or legal life…
Q: A transfer from investment property carried at fair value to owner-occupied property shall be…
A: Investments: Investment is defined as an allocation of money with the prospect of some future…
Q: S1: The realization process depends on the type of the property, plant and equipment-if the…
A: The question is multiple choice question Required Choose the Correct Option
Q: An intangible asset may be recorded: A. if acquired from an external party at a cost. B. if it is…
A: Answer - Correct Option is A. if acquired from an external party at a cost.
Q: The following are properly classified as capital expenditure, except:
A: Capital expenditure is the amount spent by the business to acquire ,…
Q: The adjusted cost base (or capital cost) of an asset includes a number of costs. Indicate which cost…
A: Adjusted Cost-:An adjusted cost base is an earnings/income tax word that relates to the modification…
Q: Which of the following statements is correct? O Intangible assets used in the operation of a…
A: An intangible asset is an asset that is not physical in nature. Goodwill , brand recognition and…
question 11
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- Under IFRS, when a company chooses the revaluation model as its accounting policy for measuring property, plant, and equipment, which of the following statements is correct? a. When an asset is revalued, the entire class of property, plant, and equipment to which the asset belongs must be revalued. b. When an asset is revalued, individual assets within a class of property, plant, and equipment to which that asset belongs can be revalued. c. Revaluations of property, plant, and equipment must be made every three years. d. An increase in an asset’s book value as a result of the first revaluation must be recognized as a component of profit and loss.Under IFRS, when an entity chooses the revaluation model as its accounting policy for measuring property, plant, and equipment, which of the following statements is correct?a. When an asset is revalued, the entire class of property, plant, and equipment (such as Land) to which that asset belongs must be revalued.b. When an asset is revalued, it is reported on the balance sheet at its current replacement cost.c. Revaluations of property, plant, and equipment must be made at least every three years.d. The revalued assets must be reported in a special section of the balance sheet separate from those assets measured using the cost model.1. When an item of asset is transferred to and from the classification investment property, carried using the cost model, the measurement basis at the date of transfer is the a. original cost. b. fair value. c. carrying amount. d. recoverable amount.2. What could be a valid reason for transfers from investment property to property, plant and equipment? a. When there is a change in use b. based on the accountant's discretion c. When the entity adopts the fair value model d. when there is change in asset's life3. An entity has an investment property that is held for rental income. The entity uses the fair value model for reporting the investment property. Which of the following statement is true? a. changes in fair value are reported in profit or loss in the current period b. changes in fair value are reported as an extraordinary gain c. changes in fair value are reported in other comprehensive income for the period d. changes in fair value are…
- Which of the following statements are correct? I. IAS 16 Property, plant and equipment requires entities to disclose the purchase date of each asset II. The carrying amount of a non-current asset is the cost or valuation of that asset less accumulated depreciation III. IAS 16 Property, plant and equipment permits entities to make a transfer from the revaluation surplus to retained earnings for excess depreciation on revalue assets IV. Once decided, the useful life of a non-current asset should not be changedChoose the correct. Under IFRS, when an entity chooses the revaluation model as its accounting policy for measuring property, plant, and equipment, which of the following statements is correct?a. When an asset is revalued, the entire class of property, plant, and equipment (such as Land) to which that asset belongs must be revalued.b. When an asset is revalued, it is reported on the balance sheet at its current replacement cost.c. Revaluations of property, plant, and equipment must be made at least every three years.d. The revalued assets must be reported in a special section of the balance sheet separate from those assets measured using the cost model.According to FASB Statement No. 34, interest must be capitalized for a. Assets that are ready for use b. Assets constructed for a firm's own use c. Assets that are not being used in the earning activities of the company d. Inventories that are produced in large quantities on a repetitive basis
- What costs are capitalized, or added to the asset account when acquiring property and equipment? A. Only the ticketed list price of the asset purchased. B. Any cost that is considered normal and necessary to get the asset into position and condition to be used. C. The lower of cost or net realizable value. D. Any of the above are allowed by U.S. GAAP as the cost to capitalize when acquiring property and equipment.Under IFRS, which of the following statements describes the fair value model for accounting for investment properties? Question 12 options: a) All investment properties are remeasured at fair value at each reporting date. b) Depreciation is recorded over the investment property’s useful life. c) Gains or losses arising from changes in fair value are recognized in other comprehensive income in the period in which they arise. d) Accumulated gains and losses are recognized in profit or loss in the period in which the investment property is derecognized.Statement 1: When an item of asset is transferred to and from the classification investment property, carried using the cost model, the measurement basis at the date of transfer is the original cost.Statement 2: Any gain or loss from the disposal of the investment property shall be determined as the difference between the net disposal proceeds and the carrying amount of the asset and shall be recognized in profit or lossStatement 3: If owner-occupied property is transferred to investment property that is to be carried at fair value, the difference between the carrying amount of the property and its fair value shall be included in profit or loss.Statement 4: If an entity determines that the fair value of an investment property is not reliably determinable on a continuing basis, the entity shall measure that investment property using the revaluation model. A. Only two of the statements are true. B. All statements are true. C. Only one of the statements is true. D. Only three…
- Statement 1: When an item of asset is transferred to and from the classification investment property, carried using the cost model, the measurement basis at the date of transfer is the original cost.Statement 2: Any gain or loss from the disposal of the investment property shall be determined as the difference between the net disposal proceeds and the carrying amount of the asset and shall be recognized in profit or lossStatement 3: If owner-occupied property is transferred to investment property that is to be carried at fair value, the difference between the carrying amount of the property and its fair value shall be included in profit or loss.Statement 4: If an entity determines that the fair value of an investment property is not reliably determinable on a continuing basis, the entity shall measure that investment property using the revaluation model. All statements are true. Only two of the statements are true. Only three of the statements are true. All statements are…Based on the knowledge that you have learned from this unit and the relevant accounting standards, answer the following questions. Your answers must demonstrate your own understandings and applications of relevant accounting standards, but not a direct quote of the standards. a.Use an example to explain what are included in the original cost of property, plant, and equipment when they are initially acquired. b. What is the basic principle for valuing property, plant, and equipment acquired in exchange for other non-monetary assets? c. Use an example to illustrate how gain or loss on disposal is calculated and recorded when an item of property, plant, and equipment is disposed of.Under IFRS, a company that acquires an intangible asset may use the revaluation model for subsequent measurement only if a. The useful life of the intangible asset can be readily determined. b. An active market exists for the intangible asset. c. The cost of the intangible asset can be measured reliably. d. The intangible asset is a monetary asset.