Which of the following items is not considered capitalisable cost of property,plant and equipment?
A) freight costs
B) import duties
C) trade discount
D) installation costs

Question

Quizplus · Accepted Answer

Trade discount is a reduction in the purchase price of an item offered by the supplier to the buyer as an incentive for making a purchase. It is not considered a capitalizable cost of property, plant, and equipment because it does not relate to the acquisition or construction of the asset. On the other hand, freight costs, import duties, and installation costs are examples of expenses that can be included in the cost of acquiring or constructing an asset and can be capitalized as part of the cost of property, plant, and equipment.

Which of the Following Items Is Not Considered Capitalisable Cost