Differentiate between Benchmark Treatment and Allowed-00104
This subjective question is related to the book/course
vu bio201 Cell Biology.
It can also be found in
vu bio201 Mid Term Solved Past Paper No. 2.
Question 1: Differentiate between Benchmark Treatment and Allowed Alternative Treatment for the Borrowing cost
Answer:
Benchmark Treatment
The benchmark treatment of borrowing costs is the most straightforward and prudent. The accounting policy adopted for borrowing costs should be disclosed Under the benchmark treatment of IAS 23 borrowing cost should be treated as expense in the period they are incurred regardless of the of how the loan is used.
Allowed alternative Treatment
Borrowing costs that are directly attributable to the acquisition, construction or production of a qualifying asset should be capitalized as cost of the asset".
