AASB 123 Borrowing Costs Defines a Qualifying Asset as an Asset

question 25

Multiple Choice

AASB 123 Borrowing Costs defines a qualifying asset as an asset that:

• A) takes a period of greater than twelve months to get ready for its intended use or sale.
• B) takes a substantial period of time to get ready for its intended use or sale.
• C) takes a period of greater than twelve months to complete.
• D) takes a substantial period of time to complete.
• E) is specified as "qualifying" under the Corporations Act.

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Definitions:

Selling Expenses

Costs incurred directly in the selling or distribution of goods or services, such as advertising, promotional materials, and sales staff salaries.

Gross Profit

The profit a company makes after deducting the costs associated with making and selling its products, or the costs associated with providing its services.

Ownership Test

Criteria used to determine if an individual or entity has the necessary ownership interest in a property or investment to qualify for certain tax benefits.

Personal Residence

The home in which a person or family lives as their primary place of residence, potentially qualifying for certain tax benefits.