1. Which of the following does NOT apply to the capitalization of borrowing costs for the purchase of assets?
a) They can have a significant impact on a company's earnings.
b) This is allowed under both ASPE and IFRS.
c) This is not allowed under IFRS.
d) They must be disclosed in the notes to the financial statements.
2. Spock Inc. exchanged merchandise that cost $19,000 and normally sold for $27,000 for a new delivery truck with a list price of $31,000. The delivery truck should be recorded on Spock's books at
3. Land is generally included in property, plant and equipment EXCEPT when
a) it is not yet ready for use.
b) it is held for resale by land developers.
c) it includes a building that must be demolished.
d) special amounts are assessed for local improvements such as sewers.
4. The revaluation model of accounting for PP&E asstes
a) uses a revaluation surplus account to hold net increases in the asset's fair value
b) may be applied to all classes of PP&E including investment property.
c) may be applied to investment property under ASPE.
d) is not allowed under IFRS.