Seeking Consistency in Relating Capital to Current Expenditures
39 Pages Posted: 18 Sep 2008 Last revised: 16 Jul 2020
Date Written: 2004
Identifies relational duration as the key factor that distinguishes capital from current expenditures for tax purposes and argues that inventory cost is fundamentally identical to capitalization. Barriers to deductibility such as illegal payment prohibitions should also be barriers to capitalization or inventory absorption.
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