A donated plant asset for which the fair value has been determined,and for which incidental costs were incurred in acceptance of the asset,should be recorded at an amount equal to its
A) incidental costs incurred.
B) fair value and incidental costs incurred.
C) book value on books of donor and incidental costs incurred.
D) book value on books of donor.

Question

Quizplus · Accepted Answer

A donated plant asset should be recorded at its fair value, and if any incidental costs were incurred in acceptance of the asset, they should be added to the recorded amount. This ensures that the asset is recorded at its true economic value on the books of the organization. The book value on the books of the donor is irrelevant for accounting purposes.

A Donated Plant Asset for Which the Fair Value Has