The capitalization of borrowing costs for the purchase of assets

Question

Quizplus · Accepted Answer

A) Capitalizing borrowing costs can result in higher depreciation and lower interest expenses, which can have a significant impact on a company's reported earnings. 
B) Capitalized borrowing costs must be disclosed in the notes to the financial statements as a significant accounting policy. 
C) Both private entities GAAP (ASPE) and international GAAP (IFRS) allow capitalization of borrowing costs as long as certain criteria are met.

The Capitalization of Borrowing Costs for the Purchase of Assets