{[ promptMessage ]}

Bookmark it

{[ promptMessage ]}

Kieso_Inter_13e_Ch10

Kieso_Inter_13e_Ch10 - Chapter 10-1 C H A P T E R C H A P T...

Info icon This preview shows pages 1–7. Sign up to view the full content.

View Full Document Right Arrow Icon

Info icon This preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon

Info icon This preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon

Info icon This preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: Chapter 10-1 C H A P T E R C H A P T E R 10 10 ACQUISITION AND DISPOSITION OF ACQUISITION AND DISPOSITION OF PROPERTY, PLANT, AND EQUIPMENT PROPERTY, PLANT, AND EQUIPMENT Intermediate Accounting 13th Edition Kieso, Weygandt, and Warfield Chapter 10-2 “Used in operations” and not for resale. Long-term in nature and usually depreciated. Possess physical substance. Property, plant, and equipment includes land, buildings, and equipment (machinery, furniture, tools). Major characteristics include: Property, Plant, and Equipment Property, Plant, and Equipment LO 1 Describe property, plant, and equipment. LO 1 Describe property, plant, and equipment. Chapter 10-3 Historical cost is reliable. Companies should not anticipate gains and losses but should recognize gains and losses only when the asset is sold. Valued at Historical Cost , reasons include: Acquisition of PP&E Acquisition of PP&E LO 2 Identify the costs to include in initial valuation of property, plant, LO 2 Identify the costs to include in initial valuation of property, plant, and equipment. and equipment. APB Opinion No. 6 states, “property, plant, and equipment should not be written up to reflect appraisal, market, or current values which are above cost.” Chapter 10-4 Includes all costs to acquire land and ready it for use. Costs typically include: Cost of Land Acquisition of PP&E Acquisition of PP&E LO 2 Identify the costs to include in initial valuation of property, plant, LO 2 Identify the costs to include in initial valuation of property, plant, and equipment. and equipment. (1) the purchase price; (2) closing costs, such as title to the land, attorney’s fees, and recording fees; (3) costs of grading, filling, draining, and clearing; (4) assumption of any liens, mortgages, or encumbrances on the property; and (5) Additional land improvements that have an indefinite life. Chapter 10-5 Includes all costs related directly to acquisition or construction. Costs typically include: Cost of Buildings LO 2 Identify the costs to include in initial valuation of property, plant, LO 2 Identify the costs to include in initial valuation of property, plant, and equipment. and equipment. (1) materials, labor, and overhead costs incurred during construction and (2) professional fees and building permits. Acquisition of PP&E Acquisition of PP&E Chapter 10-6 Include all costs incurred in acquiring the equipment and preparing it for use. Costs typically include: Cost of Equipment LO 2 Identify the costs to include in initial valuation of property, plant, LO 2 Identify the costs to include in initial valuation of property, plant, and equipment. and equipment. (1) purchase price, (2) freight and handling charges (3) insurance on the equipment while in transit, (4) cost of special foundations if required, (5) assembling and installation costs, and (6) costs of conducting trial runs....
View Full Document

{[ snackBarMessage ]}

What students are saying

  • Left Quote Icon

    As a current student on this bumpy collegiate pathway, I stumbled upon Course Hero, where I can find study resources for nearly all my courses, get online help from tutors 24/7, and even share my old projects, papers, and lecture notes with other students.

    Student Picture

    Kiran Temple University Fox School of Business ‘17, Course Hero Intern

  • Left Quote Icon

    I cannot even describe how much Course Hero helped me this summer. It’s truly become something I can always rely on and help me. In the end, I was not only able to survive summer classes, but I was able to thrive thanks to Course Hero.

    Student Picture

    Dana University of Pennsylvania ‘17, Course Hero Intern

  • Left Quote Icon

    The ability to access any university’s resources through Course Hero proved invaluable in my case. I was behind on Tulane coursework and actually used UCLA’s materials to help me move forward and get everything together on time.

    Student Picture

    Jill Tulane University ‘16, Course Hero Intern