ACC 321- Codification Exercise #2

ACC 321- Codification Exercise #2 - Nick Connolly ACC 321-...

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Nick Connolly ACC 321- Dr. Ruben 3/29/11 Codification Exercise 10-1 a) Capitalize is used to indicate that the cost would be recorded as the cost of an asset. That procedure is often referred to as deferring a cost, and the resulting asset is sometimes described as a deferred cost. b) Nonmonetary Asset= Assets are assets and other than monetary ones. A few examples are inventories and property, plant, and equipment c) Nonreciprocal transfer= transfer of assets or services from a business to its owners or to another entity, d) Contribution= An unconditional transfer of cash or other assets to an entity or a settlement or cancellation of its liabilities in a voluntary nonreciprocal transfer by another entity acting other than as an owner. 10-2 The Codification explains, that interest cost s can be capitalized for all assets that require a period of time to get them ready for their intended use which includes developing land. You only capitalize interest costs when you are borrowing money. The main factor to note is that instead
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ACC 321- Codification Exercise #2 - Nick Connolly ACC 321-...

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