For Each of the Following Items, Indicate Whether Each Would

question 85

Multiple Choice

For each of the following items, indicate whether each would be treated as a
-Costs incurred prior to using the asset, such as costs to prepare the asset for use, installation costs

• A)capital expenditure
• B)revenue expenditure

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Definitions:

Legal Firm

A business that provides legal services and is staffed by lawyers.

Activity-Based Costing

A method of allocating overhead and indirect costs to specific products or projects based on their use of resources.

Activity Rate

The cost driver rate that is used to assign activity costs to products or services based on their consumption of the activity.

Cost Pools

Groups of individual costs combined to allocate costs more efficiently.