#92 Valuation Flashcards
1
Q
Methods of Acquiring Plant Assets: Issuance of securities
What is the acquisition cost of an asset acquired through the issuance of stocks or bonds?
A
Either the fair value of the security or the fair value of the asset acquired, whichever can be most clearly determined.
2
Q
Methods of Acquiring Plant Assets: Donated Assets
Donated assets are recorded at what value?
A
Assets received in donation are recorded at their fair value. A revenue or gain is also recorded.
3
Q
What are the capitalized costs of a self constructed asset?
A
- Labor
- Material
- Overhead
- Interest cost incurred during the construction period
4
Q
Capitalization of interest is allowed only when assets are constructed, not purchased.
True or False?
A
True
