For each transaction numbered 1 through 6 below, identify which accounting treatment-capitalized or expensed-should be used to properly account for the transactions.You may use each letter more than once or not at all.
-Construction insurance to cover theft or vandalism during building construction
A) Expensed immediately
B) Capitalized as part of the cost of the new asset

Question

Quizplus · Accepted Answer

Construction insurance that specifically relates to the construction phase of a building is typically capitalized as part of the overall cost of the construction project. This is because it is directly associated with bringing the asset to its intended use.

For Each Transaction Numbered 1 Through 6 Below, Identify Which