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The broad principles of accounting for Property, Plant and Equipment involve distinguishing, between capital and Revenue expenditure, measuring the cost of assets, determining how they
The broad principles of accounting for Property, Plant and Equipment involve distinguishing, between capital and Revenue expenditure, measuring the cost of assets, determining how they should be depreciated and dealing with the problems of subsequent measurement and subsequent expenditure. IAS 16 Property, Plant and Equipment has the objective of improving consistency in these areas. Required: - (a) Explain: (i) How the Initial Cost of Property, Plant and Equipment should be measured (1 Mark) (ii) The circumstances in which subsequent expenditure on those assets should be Captialised. (1 Mark) (b,a) Explain the requirements regarding the revaluation of property, plant and equipment and the accounting treatment of surpluses and deficits on revaluation and gains and losses on disposal
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