Which statements are correct concerning measurement of cost of property, plant and equipment?
Which statements are correct concerning measurement of cost of property, plant and equipment?
I. The purchase price of an item of property, plant and equipment is the cash price equivalent at the date of recognition
II. If payment is deferred beyond normal credit terms, the difference between the cash price equivalent and total payment is recognized as interest expense over the life of the asset.
III. If an item of property, plant and equipment is acquired in exchange for a nonmonetary asset or a combination of monetary and nonmonetary asset, the cost of such item is measured at fair value unless the exchange transaction lacks commercial substance or fair value of either asset received or given up is not reliably determinable.
IV. If an entity is able to determine reliably the fair value of both the asset given up and asset received in an exchange, the fair value of the asset given up is used to measure the cost of asset received in exchange.
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