Research output: Contribution to Journal/Magazine › Journal article › peer-review
Research output: Contribution to Journal/Magazine › Journal article › peer-review
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TY - JOUR
T1 - Capitalisation of Interest
AU - Peasnell, Ken
PY - 1993/3
Y1 - 1993/3
N2 - The purpose of this paper is to examine the case for capitalising interest on self-constructed and maturing assets. Three perspectives on interest capitalisation- cost matching, opportunity cost, and valuation—are compared and contrasted. The paper's principal contributions are twofold: (i) to show how interest capitalisation can be related to the concept of deprival value; and (ii) to analyse the issues of capital structure, the choice of an appropriate capitalisation rate and the treatment of the resultant credits that have plagued the efforts of accountants in this area.
AB - The purpose of this paper is to examine the case for capitalising interest on self-constructed and maturing assets. Three perspectives on interest capitalisation- cost matching, opportunity cost, and valuation—are compared and contrasted. The paper's principal contributions are twofold: (i) to show how interest capitalisation can be related to the concept of deprival value; and (ii) to analyse the issues of capital structure, the choice of an appropriate capitalisation rate and the treatment of the resultant credits that have plagued the efforts of accountants in this area.
U2 - 10.1006/bare.1993.1004
DO - 10.1006/bare.1993.1004
M3 - Journal article
VL - 25
SP - 17
EP - 42
JO - British Accounting Review
JF - British Accounting Review
SN - 0890-8389
IS - 1
ER -