Solution:
ABC Company has expanded its operations and purchased some furniture for its recently rented show room situated in north of the city, which is expected to have useful life of five years.
This furniture is not meant for resale; therefore, it should be capitalized and depreciated under "Property, Plant, and Equipment".
During the same year the company purchased furniture and other home accessories from renowned designers and sold it to customers from its show room.
This furniture is meant for resale; therefore, it should be listed under "Inventory"
ABC Company has expanded its operations and purchased some furniture for its recently rented show room situated in north of the city, which is expected to have useful life of five years.
This furniture is not meant for resale; therefore, it should be capitalized and depreciated under "Property, Plant, and Equipment".
During the same year the company purchased furniture and other home accessories from renowned designers and sold it to customers from its show room.
This furniture is meant for resale; therefore, it should be listed under "Inventory"
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