The cost of a plant asset indeed consists of all necessary and reasonable expenditures to acquire it and prepare it for its intended use. It is TRUE.
A plant asset is a long-term or fixed asset used for the production of goods and services.
Plant assets are tangible assets and they are monetarily beneficial for more than one year.
Plant assets can be differentiated from current assets, which do not last in their present form for more than a year.
Thus, in accounting for the cost of plant assets, all necessary and reasonable expenditures to acquire it and prepare it for its intended use should be included.
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