Multiple Choice
A construction company purchased a piece of equipment with a price of $100,000 on March 1 of the current year. The amounts are related to the equipment purchase. Match the items and explain how each item should be accounted for. (Choices may be used more than once.)
-The company financed the equipment purchase with a bank loan. Interest of $3,000 was paid on the loan during the year.
A) This item should be included as part of the cost of the equipment.
B) This item should be considered a revenue expenditure.
Correct Answer:
Verified
Correct Answer:
Verified
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