Which of the following statements applies to the recognition of property, plant, and equipment acquisitions?
A) It is certain that the item's associated future benefits will flow to the entity.
B) It is probable that the item's associated future benefits will flow to the entity.
C) The cost can be measured reliably.
D) It is probable that the item's associated future benefits will flow to the entity, and the cost can be measured reliably.

Question

Quizplus · Accepted Answer

According to IAS 16 (International Accounting Standard) on Property, Plant, and Equipment, recognition criteria for property, plant, and equipment acquisitions include both probability of future benefits flowing to the entity and reliable measurement of the cost. Therefore, option D is the correct answer. Option A is incorrect because recognition is based on probability, not certainty. Option B is also incorrect because probability alone is not sufficient for recognition. Option C is also incomplete, as reliable measurement is necessary but not sufficient for recognition.

Which of the Following Statements Applies to the Recognition of Property