[amp_mcq option1=”Yes” option2=”After usage of such capital goods” option3=”After capitalizing in books of Accounts” option4=”None of the above” correct=”option1″]<\/p>\n
The correct answer is A. Yes.<\/p>\n
Credit on capital goods can be taken immediately on receipt of the goods. This is because capital goods are considered to be assets and assets are recorded in the books of accounts at their cost. The cost of capital goods includes the purchase price, freight, insurance, and any other costs incurred in bringing the goods to their present location and condition.<\/p>\n
Once the capital goods have been recorded in the books of accounts, they can be depreciated over their useful life. Depreciation is a method of allocating the cost of an asset over its useful life. The amount of depreciation is calculated based on the asset’s cost, its useful life, and its salvage value.<\/p>\n
The depreciation expense is recorded in the income statement and reduces the company’s taxable income. This can result in a tax saving for the company.<\/p>\n
The following are the options of the question and their brief explanation:<\/p>\n
[amp_mcq option1=”Yes” option2=”After usage of such capital goods” option3=”After capitalizing in books of Accounts” option4=”None of the above” correct=”option1″]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[969],"tags":[],"class_list":["post-54153","post","type-post","status-publish","format-standard","hentry","category-gst","no-featured-image-padding"],"yoast_head":"\n