Determine the acquisition cost of the equipment.

Q: Define Exploration costs.

A: Cost:   It refers to the economic value incurred by the business to manufacture a product or render…

Q: Discuss the key aspects of the 'cost model' and 'revaluation model' for non-current assets, and…

A: solution cost model                 The model where the non current assets are reported on the…

Q: Define Restoration costs.

A: Restoration means the act of renewing or repairing something.

Q: Identify the various costs included in the initial cost of property, plant, and equipment, natural…

A:

Q: Understand accounting issues related to acquiring and valuing plant assets.

A: Following are the accounting issues that are related to acquiring and valuing plant assets: a)  Cash…

Q: Explain why an organization should buy or lease when purchasing equipment.

A: Leasing involves the two parties, a lessee and lessor ,Whereas purchasing involves a buyer and…

Q: define current asset and explain the particularity of an operating cycle

A: Solution:- a)Explanation of current assets as follows:- 1)Definition:- Current assets means assets…

Q: Define the term Estimated salvage value?

A: Estimated salvage value It is the evaluated book value of an asset after depreciation is finished,…

Q: What is the auditor’s role with respect to the fixed asset system?

A: Definition: Fixed Assets: It refers to the long-term assets having a useful life of more than a year…

Q: lassification costs

A: A long-term physical piece of property or equipment that a company owns and utilises in its…

Q: Provide a very clear and detailed introduction on the repossession procedure.

A: Repossession in the accounting or for a business is taken goods back or getting back the assets or…

Q: Discuss and explain the tension between “Asset Transformation” and “Asset Conversion”

A: There exists a subtle yet systematic tension between asset transformation and asset conversion. Both…

Q: What are the technique of project appraisal

A: Step 1: Techniques of the project appraisal are: Profitability index Payback period NPV IRR

Q: Determine the initial cost of property, plant, and equipment and intangible assets acquired in…

A: Property, Plant, and Equipment or PP&E is a classification shown on a balance sheet. It normally…

Q: An

A: Property Plant and Equipment: It is the tangible asset used in the business to generate revenue. It…

Q: Define accelerated depreciation method

A: Depreciation can be referred as the reduction in the fair value of an asset due to its usage over…

Q: Describe the following terms:  1. Bid Security 2. Performance Security

A: Hi, there, Thanks for posting the question. As per our Q&A honour code, we must answer the first…

Q: What are the primary considerations that should be made when refinancing?

A: Individual consider refinancing of the loan because of the following reasons: Interest rates have…

Q: Discuss the risk of material misstatement inthe acquisition and expenditure cycle.

A: Material Misstatement refers to the misleading information in the statement of affairs of the…

Q: Explain term Renovation and Refinancing with example?

A: A renovation loan is a type of loan that includes the amount of mortgage as well as the amount of…

Q: Describe Expenditures Subsequent to Acquisition.

A: Definition:   Property, plant, and equipment: These assets are long-lived economic resources which…

Q: Chalmers Corporation operates in multiple areas of the globe, and relatively large price changes are…

A: Step 1: Current Profit Calculation:• Calculate the total revenue.• Calculate total variable costs.•…

Q: How can we determine the service life of an asset?

A: A tangible asset is a substantial resource. Tangible resources incorporate fixed resources including…

Q: Describe Self-Constructed Assets and explain  Research and Development

A: Property, plant and equipment:   Property, plant and equipment are the tangible assets which are…

Q: What is important for a MACRS to consider at the time of disposal?

A: MACRS stands for Modified Accelerated Cost Recovery System. These are the regulations of…

Q: Describe the cost of fixed assets.

A: Fixed Assets - Fixed Assets are assets that are non-current in nature. These assets are purchased…

Q: What are the benefits of adopting a Condition Base Monitoring (PredictiveMaintenance) in the…

A: A condition monitoring system is a critical component of AM and reliability. CMS scope typically…

Q: In what ways might a depreciable asset's estimated service life be influenced?

A: The Answer

Q: . Cost of equipment include all expenditures incurred in acquiring the equipment and preparing it…

A: Cost of equipment includes all expenditure that forms part in acquiring the equipment and preparing…

Capital Gain

Any capital asset when sold can give the seller a higher or lower price from its purchase price leading to a capital gain or capital loss. The time period of holding an asset is decided based on if it is a long term or short-term capital gain. On that basis, the rate of taxation is decided if it is 20%, 15% or according to the tax brackets. The rate of taxation differs in the case of equity or debt, whether long or short term. The capital gain can be adjusted from capital loss to arrive at a net capital gain. The amount of gains and the exemption has to be reported in the tax return filed in the financial year in which the asset was transferred. The tax return can be filed quarterly, monthly, semi-annually or annually.