- This topic has 1 reply, 2 voices, and was last updated 4 years ago by .
Viewing 2 posts - 1 through 2 (of 2 total)
Viewing 2 posts - 1 through 2 (of 2 total)
- You must be logged in to reply to this topic.
Interactive BPP books for September 2026 exams, recommended by OpenTuition.
Get discount code >>
Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA FR Exams › Borrowing cost
Hello
I want to understand why is the specific borrowing cost for an asset capitalised rather than expensed? What is the explanation behind it?
Hi,
We capitalise costs that are directly attributable to the asset. The borrowing costs are directly attributable as without using the loan to construct the asset then we would not have incurred the costs, hence the borrowing costs are capitalised as opposed to being expensed.
Thanks
