The Period of Time for Which Interest Is to Be

question 30

Multiple Choice

The period of time for which interest is to be capitalized ends when ________.

• A)no additional interest cost is actually being incurred on direct financing for the acquisition of the asset
• B)a constructed is substantially complete and put into use
• C)a constructed asset is substantially complete and ready for its intended use
• D)an acquired asset is received and ready for its intended use

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Definitions:

Job Order Costing

An accounting methodology used to assign production costs to individual products or batches, based on the specific jobs or orders.

Direct Labor Hour

A measure of the labor time spent on a specific project or production activity, often used for costing purposes.

Work in Process Inventory

The value of goods in various stages of production in a manufacturing company, not yet completed.

Work in Process

Inventory representing partially completed goods that are still in the process of production.