Which of the Following Would Not Be Considered Part of the Cost

question 103

Multiple Choice

Which of the following would not be considered part of the cost of equipment recently purchased?

• A) Sales tax.
• B) Transportation charges.
• C) Installation and setup charges.
• D) All three are capitalized costs.

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Definitions:

Capital Interest

This is the amount of interest owed on loans used to purchase assets intended for long-term use, reflecting the cost of financing capital investments.

Current Partners

Individuals or entities currently engaged in a business partnership, sharing responsibilities, profits, and losses of the venture.

Bonus

A bonus is an extra payment given to employees beyond their regular salary, often awarded for achieving specific performance targets or as part of the benefits package.

Capital Accounts

Represent the amount of money the owners have invested in a business, plus any profits or minus any losses.