Question

which of the following is considered an "allocable cost" for purposes of the uniform capitalization rules? A) Expenses connected with property produced under a long-term contract. B) Interest paid to produce property that has an estimated production period of more than two years. C) Marketing expenses. D) Research and experimental expenditures.

Answer 1

Answer:

Option B : Interest paid to produce property that has an estimated production period of more than two years.

​​​​​​Explanation:

For the purpose of unifrom capitalization rules , among the following option, interest paid to produce property that has an estimated period greater than two years is only an allocable cost.

Other options such as marketing cost, research and experimental expenditures etc. does not fall under this category.

So the correct answer is Option B.