tailieunhanh - Lecture Intermediate accounting: IFRS edition - Chapter 10: Property, plant and equipment, investment property, and intangible assets: acquisition and disposition

After studying this chapter, you should be able to: Identify the various costs included in the initial cost of property, plant, and equipment, natural resources, and intangible assets; determine the initial cost of individual property, plant, and equipment and intangible assets acquired as a group for a lump-sum purchase price; determine the initial cost of property, plant, and equipment and intangible assets acquired in exchange for a deferred payment contract; | PROPERTY, PLANT AND EQUIPMENT, INVESTMENT PROPERTY, AND INTANGIBLE ASSETS: ACQUISITION AND DISPOSITION Chapter 10 Chapter 10: Property, Plant, and Equipment and Intangible Assets: Acquisition and Disposition This chapter and the one that follows address the measurement and reporting issues involving property, plant, and equipment and intangible assets. These long-lived tangible and intangible assets are used in the production of goods and services. We will also discuss a special class of property held specifically by companies to earn rental income and/or for capital appreciation (classified as investment property). Chapter 10 covers the valuation at date of acquisition and the disposition of these assets. Long-lived, Revenue-producing Assets Types of Assets Expected to Benefit Future Periods General Rule for Cost Capitalization The initial cost of an asset includes the purchase price and all expenditures necessary to bring the asset to its desired condition and location for use. Part I. Long-lived, revenue producing assets are assets that are used actively in the business, and that are expected to benefit the operations into the future. There are two major categories of these assets. Tangible assets have physical substance. Included in this category are land, buildings, equipment, machinery, vehicles, and investment properties. Intangible assets are assets without physical substance. Included in this category are patents, copyrights, trademarks, franchises, and goodwill. Part II. Long-lived, revenue-producing assets may be acquired in a number of ways. Regardless of the method of acquisition, the assets are recorded at their original cost. The recorded cost includes the purchase price and all expenditures necessary to bring the asset to its desired condition and location for use. Equipment Net purchase price Taxes Transportation costs Installation costs Modification to building necessary to install equipment Testing and trial runs Costs to be Capitalized Land . | PROPERTY, PLANT AND EQUIPMENT, INVESTMENT PROPERTY, AND INTANGIBLE ASSETS: ACQUISITION AND DISPOSITION Chapter 10 Chapter 10: Property, Plant, and Equipment and Intangible Assets: Acquisition and Disposition This chapter and the one that follows address the measurement and reporting issues involving property, plant, and equipment and intangible assets. These long-lived tangible and intangible assets are used in the production of goods and services. We will also discuss a special class of property held specifically by companies to earn rental income and/or for capital appreciation (classified as investment property). Chapter 10 covers the valuation at date of acquisition and the disposition of these assets. Long-lived, Revenue-producing Assets Types of Assets Expected to Benefit Future Periods General Rule for Cost Capitalization The initial cost of an asset includes the purchase price and all expenditures necessary to bring the asset to its desired condition and location for use. Part