ACCA Applied Skills · Financial Reporting · Inventories and agriculture
Which of the following is a bearer plant that is accounted for under IAS 16 Property, Plant and Equipment rather than IAS 41?
Tea bushes are bearer plants because they are used repeatedly to produce leaves over several periods and are not sold as produce. They are accounted for under IAS 16. Crops, timber trees and animals for meat are consumable biological assets under IAS 41.
- AWheat grown to be harvested as a crop
- BTea bushes used to produce leaves over several yearsCorrect
- CPine trees grown to be felled for timber
- DLambs being fattened for sale as meat
Explanation
A bearer plant is a living plant used in producing agricultural produce, expected to bear produce for more than one period, and with a remote likelihood of being sold as produce. Tea bushes meet this. Wheat, trees grown for timber and animals are consumable biological assets under IAS 41.
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