The Correct Statement Concerning Subsequent Costs Incurred in Relation to a Depreciable

question 51

Multiple Choice

The correct statement concerning subsequent costs incurred in relation to a depreciable asset after its original acquisition is:

• A) If the subsequent cost of replacing part of an item of equipment is added to the carrying amount of that asset then the carrying amount of the part that is replaced must be decommissioned.
• B) The replacement of the tyres on a motor would add to the expected life of the vehicle.
• C) The painting of a building would normally be considered an improvement and capitalised.
• D) Subsequent costs should nearly always be capitalised rather than charged to an expense account.

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Definitions:

Wisconsin Public Sector

Refers to the portion of Wisconsin's economy that is controlled and operated by government entities, including state and local government jobs and services.

Collective Bargaining

A process where employers and representatives of employees negotiate terms of employment, including wages, hours, and working conditions.

Base Wages

The initial or minimum amount paid to an employee for their services, excluding any additional benefits, bonuses, or overtime.

Landrum-Griffin Act

A 1959 United States federal law that regulates labor unions' internal affairs and their officials' relationships with employers.