Which one of the following statements is true?

Question

Quizplus · Accepted Answer

According to generally accepted accounting principles (GAAP), interest can be capitalized when it is incurred during the construction of a qualifying asset. However, once the asset is substantially complete and ready for its intended use, no further interest can be capitalized. Therefore, option D is the only true statement. Option A is false because constructing an asset for less than its purchase price does not necessarily result in a profit. Option B is false because a donation of property, plant, or equipment is typically recorded at its fair value, which may result in either a gain or a loss. Option C is false because development stage enterprises must report all losses, regardless of whether sales have been made.

Which One of the Following Statements Is True