Q16 BPP

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February 24, 2021 at 2:36 pm #611558
mainai92
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The ‘physical capital maintenance’ concept states that profit is the increase in the physical productive
capacity of the business over the period. This concept is applied in:
A Current cost accounting
B Historical cost accounting
C Current value accounting
D Current purchasing power accounting

In the text book, there is only Historical cost accounting and current value accounting and the answer is A. Current cost accounting – which confused me …
February 24, 2021 at 8:28 pm #611580
P2-D2
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Hi,

Current cost accounting is where we would look at the price of the item in today’s value. So we may have bought a specialist asset at 10,000 several years ago (historic cost) but today it would cost us 12,000 (say).

Thanks
October 30, 2021 at 9:51 pm #639512
Iriswang1993
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Hello,

Then what’s the difference between Current Cost Accounting and Current Value Accounting?
November 7, 2021 at 9:33 am #640141
P2-D2
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Hi,

Have you looked into this yourself first? I think you should and then I’ll happily explain any difficulties you might have in understanding the differences.

Thanks
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