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Under AS 10, are professional fees paid to consultants for advice on the acquisition of a plant capitalised?
ANo, they are always an administrative expense
BYes, they are a directly attributable cost
COnly 50% may be capitalised
DNo, they are treated as deferred revenue
Answer & Solution
Correct answer: B. Yes, they are a directly attributable cost
1. AS 10 capitalises costs directly attributable to bringing the asset to the location and condition for its intended use.
2. Professional/consultancy fees for acquiring and installing the asset are such directly attributable costs.
3. The ₹6,75,000 consultants' fees are therefore capitalised.
_Source: ICAI BoS CA Intermediate Paper 1 (Advanced Accounting), Sept 2025 MCQ — Q.9, AS 10 Property, Plant & Equipment._
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