USA IAS 16 (Element of Cost)


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According IAS 16 ,Paragraph 16(b) ,any cost directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management should become part of cost of PPE . if an asset get damaged before operating or during installation repair cost to make that asset available for use should be expensed out or capitalized?
 
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kirby

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Expensed. The cost is a repair which will not extend the life of the original undamaged asset nor improve its original undamaged functions.
 
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The cost of repair should be expensed because this repair is not expected to add life in the asset.
 

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