Economics · Accounting Standards
A bank renovated its corporate headquarters in Mumbai during 2024. As per Accounting Standard 10 (AS 10) regarding Property, Plant, and Equipment, which of the following costs incurred during the renovation project must be capitalized as part of the cost of the building rather than being charged to the revenue account as repairs and maintenance?
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1Initial operating losses incurred before the renovated building reached full occupancy capacity.
- 2Professional fees paid to architects and engineers for the structural enhancement of the building's load-bearing capacity.✓
- 3Costs of relocating staff to a temporary rented office space while the renovation works were being completed.
- 4The cost of a mandatory environmental impact study conducted after the building was already put into active use.
Correct answer
Professional fees paid to architects and engineers for the structural enhancement of the building's load-bearing capacity.
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