Historical Cost Historical cost has been the most commonly used measurement attribute for assets. Find the...

Historical Cost Historical cost has been the most commonly used measurement attribute for assets. Find the places in the FASB ASC that cite historical cost. Looking for FASB ASC section number.

Expert Solution

Historical costs in which Assets are recorded in cash and cash equivalents paid or fair value consideration given to acquire them,

In short historical costs are incurred in purchasing a product

The main advantage of using historical cost accounting model is simplicity and certainty

The most disadvantage of using this method are book value is based on our of date costs

FASB ASC 7-3 defines historical costs is the most commonly used measurement attributable for assets.

Places in the FASB ASC that cite historical cost:

Paragraph 835-20-05-1 states that historical cost of acquiring an asset includes the cost primarily incurred to bring it to the condition and location necessary for its intended use.

If an asset requires a period of time to carry out the activities necessary to bring it into that condition and location the interest cost incurred during that period as a result of expenditure for the asset is that part of historical cost of acquiring the asset.

ekkarill92 answered 1 year ago

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