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Reasons for the exclusion for payments

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Reference no: EM133205507

A company,  BP Sdn Bhd has bought a new machine in 2020.  The following expenses have been incurred: 

 

RM

RM

Purchase price

48,000

 

Discount

(1,000)

 

 

 

47,000

Delivery charge

 

400

Erection charge

 

500

Additional component to increase capacity

 

1,000

Replacement parts

 

600

 

 

49,500

Required:

In accordance with IAS 16, Property, plant and equipment, calculate the cost for the above machine that will be capitalised. State the reasons for the exclusion for any payments that has not be included in the computation of the costs. 

Reference no: EM133205507

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