Question

All costs incurred in acquiring or producing a Unit of Property (UOP) are included in its cost, EXCEPT for employee compensation and overhead costs.The taxpayer can elect to capitalize employee compensation and overhead costs (can elect separately or both). The cost includes all related expenditures incurred before the date the asset is placed in service, even if these expenditures would be repairs if incurred after the asset was placed in service.The cost of a UOP includes costs incurred to obtain a clean title and investigation costs. True or false?

Answer 1

The statement is true. All costs incurred in acquiring or producing a Unit of Property (UOP) are included in its cost, except for employee compensation and overhead costs.

Step-by-step explanation:

The statement is true.

According to the given information, all costs incurred in acquiring or producing a Unit of Property (UOP) are included in its cost, except for employee compensation and overhead costs. However, the taxpayer can elect to capitalize employee compensation and overhead costs. The cost of a UOP also includes costs incurred to obtain a clean title and investigation costs.