Plant assets purchased on long-term credit contracts should be accounted for at

Question

Quizplus · Accepted Answer

Plant assets purchased on long-term credit contracts should be accounted for at the present value of the future payments, as it represents the fair value of the asset at the time of purchase. The present value takes into account the time value of money and any interest that may be charged on the payments over time. The total value of the future payments or the future amount of the future payments would not provide an accurate representation of the asset's value at the time of purchase.

Plant Assets Purchased on Long-Term Credit Contracts Should Be Accounted