Answer
Assets qualifying for capitalization include:
i. Assets that are constructed or produced for an organizations’ own use. This includes assets constructed or produced for the enterprise by others for which deposits or progress payments have been made.
ii. Assets intended for sale or lease that are constructed or otherwise produced as discrete projects for example, ships or real estate developments.
Work Step by Step
These provisions are as outlined in FAS 34, Par 9, “qualifying assets.”
