Using the cost model outlined in IAS 16 to measure property,plant and equipment at acquisition,which of the following costs would not be included?
A)directly attributable costs
B)initial estimates of dismantling and removal costs
C)12-month servicing plan
D)purchase price

Question

Quizplus · Accepted Answer

The 12-month servicing plan is considered to be a subsequent expense and not directly related to the acquisition of the property, plant, and equipment. Therefore, it would not be included in the cost base under IAS 16. A, B, and D would all be included as they are directly attributable costs or initial estimates of costs related to the acquisition.

Using the Cost Model Outlined in IAS 16 to Measure