Asked by
Tammie Ritch
on Oct 28, 2024Verified
Under GAAP, which one of the following types of costs should not be capitalized?
A) rearrangements
B) routine maintenance
C) replacements
D) additions
GAAP
Stands for Generally Accepted Accounting Principles, which are a common set of accounting principles, standards, and procedures that companies use to compile their financial statements.
Routine Maintenance
Regular, scheduled work done on equipment, machines, or systems to prevent unexpected breakdowns and to keep them operating efficiently.
Capitalized
The process of recording a cost or expense on the balance sheet for the purposes of spreading out the expense over the useful life of an asset, rather than charging it to expense all at once.
- Develop comprehension of how expenses for self-constructed assets are capitalized.
Verified Answer
FA
Learning Objectives
- Develop comprehension of how expenses for self-constructed assets are capitalized.