Transportation charges and insurance while in transit are part of the cost of equipment and therefore debited to the equipment account.

Question

Quizplus · Accepted Answer

Transportation charges and insurance costs incurred while equipment is in transit are considered part of the acquisition cost of the equipment. Therefore, they are capitalized and debited to the equipment account, reflecting their role in bringing the asset to its intended use and location.

Transportation Charges and Insurance While in Transit Are Part of the Cost