Business Administration 2257 Chapter Notes - Chapter 9: Capital Cost Allowance, Book Value

• School: Western University
• Department: Business Administration
• Course: Business Administration 2257
• Professor: Eleni Petrou

Document Summary

Chapter 9 - reporting and analyzing long - lived assets. They are long lived resources that a company controls, are tangible, and are not intended for sale to customers. Used for production and sale of goods/services to customers/ rental to others etc. Most companies record ppe at cost including the following: Purchase price, including non-refundable taxes and duties, less any discounts or rebates. Expenditures necessary to bring the asset to its required location and make it ready for intended use. Estimate of any future obligations related to dismantling, removing, or restoring the asset at end of its useful life. Costs that benefit only the current period are expensed - they are called operating expenditures. Costs that benefit future periods are capitalized in long-lived asset account and recorded as either ppe, - called capital expenditures. Costs to dismantle, remove, or restore the long-lived asset when retired, costs must also be estimated and included in cost of asset - asset retirement costs.