On 1 January 2019 Planet plc began constructing an item of Machinery, the details of this...

 

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On 1 January 2019 Planet plc began constructing an item of Machinery, the details of this are: Materials 40,000 Labour costs 15,000 Pre-production testing 5,000 Sale of by-products produced as part of testing process (1,000) Site preparation costs 11,000 Staff training 2,000 10,000 Allocated overheads (60% general administration and 40% directly attributable) The plant was completed and became available for use on 1/3/2020. The estimated useful life of the Machine is 10 years. Required Identify the costs that should be capitalized as part of the plant and the amounts to be written off in the profit and loss On 1 January 2019 Planet plc began constructing an item of Machinery, the details of this are: Materials 40,000 Labour costs 15,000 Pre-production testing 5,000 Sale of by-products produced as part of testing process (1,000) Site preparation costs 11,000 Staff training 2,000 10,000 Allocated overheads (60% general administration and 40% directly attributable) The plant was completed and became available for use on 1/3/2020. The estimated useful life of the Machine is 10 years. Required Identify the costs that should be capitalized as part of the plant and the amounts to be written off in the profit and loss

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