3. Statement 1: An entity shall begin.capitalizing borrowing costs as part of the cost of qualifying asset on the date of recognition. Statement 2: Expenditures of a qualifying asset include only those expenditures that have resulted in payment of cash, transfers of other assets, or the assumption of interest- bearing liabilities. a. Only the first statement is correct. b. Only the second statement is correct. С. Both statements are correct. d. Neither of the statements is correct.

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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8.
Statement 1:
An entity shall begin capitalizing borrowing costs
as part of the cost of qualifying asset on the date of
recognition.
Statement 2: Expenditures of a qualifying asset include only those
expenditures that have resulted in payment of cash,
transfers of other assets, or the assumption of interest-
bearing liabilities.
а.
Only the first statement is correct.
b. Only the second statement is correct.
С.
Both statements are correct.
d. Neither of the statements is correct.
Transcribed Image Text:8. Statement 1: An entity shall begin capitalizing borrowing costs as part of the cost of qualifying asset on the date of recognition. Statement 2: Expenditures of a qualifying asset include only those expenditures that have resulted in payment of cash, transfers of other assets, or the assumption of interest- bearing liabilities. а. Only the first statement is correct. b. Only the second statement is correct. С. Both statements are correct. d. Neither of the statements is correct.
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