chapter 10 notes - from the seller transportation costs...

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Our objective in identifying the costs of an asset is to distinguish the expenditures that produce future benefits from those that produce benefits only in the current period. The costs in the second group are recorded as expenses, but those in the first group are capitalized; that is, they are recorded as an asset and expensed in future periods. The cost of equipment includes the purchase price plus any sales tax (less any discounts received
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Unformatted text preview: from the seller), transportation costs paid by the buyer to transport the asset to the location in which it will be used, expenditures for installation, testing, legal fees to establish title, and any other costs of bringing the asset to its condition and location for use....
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