CAF-1 · Chapter 2 · Question 2 of 15
Under IAS 23, which of the following is NOT considered a borrowing cost?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: C) Equity dividends declared and paid to ordinary shareholders.
Explanation
Borrowing costs are interest and other costs incurred in connection with the borrowing of funds. Dividends paid on equity are distributions of profit, not costs associated with borrowing funds.
More IAS 23 Borrowing Costs MCQs
- Q4Which of the following is typically excluded from being a 'qualifying asset' under IAS 23?
- Q5Which of the following costs is NOT considered a borrowing cost under IAS 23?
- Q6What is the condition for capitalizing borrowing costs regarding the probability of economic benefits?
- Q7When does the capitalization of borrowing costs commence?
- Q8During a major construction project, work is suspended for four months due to a prolonged labor strike. What should happen to the…