Inventory and PP&E

ASC 220-40 (added by ASU 2024-03) requires public business entities to disaggregate, in a tabular note disclosure, each "relevant expense caption" presented on the face of the income statement in continuing operations into prescribed natural expense categories: purchases of inventory, employee compensation, depreciation, intangible asset amortization, and DD&A of oil-and-gas/other depletion (220-40-50-6). Other GAAP-required expense, gain, and loss items must be pulled into the same table (220-40-50-21 through 50-22), expense reimbursements must be addressed (50-26 through 50-29), and any residual must be shown as "other items" with a qualitative description of its composition (50-30). Entities must also disclose total selling expenses and, annually, how they define selling expenses (50-35 through 50-36).

This industry-specific subtopic addresses how a federal government contractor presents amounts in the income statement relating to terminated contracts. After ASC 2014-09 superseded most of its guidance, the only surviving rule is that items the contractor keeps without making a claim for cost or loss stay on the balance sheet as inventory or deferred charges (220-912-45-3).

This Subtopic addresses how a real estate entity classifies cash payments to purchase real estate in the statement of cash flows. Real estate is generally a productive asset, so its purchase is an investing cash outflow; but if a developer acquires real estate specifically for resale (to be subdivided, improved, and sold in lots), the payment is an operating cash flow because the property is akin to inventory.

This Subtopic tells time-share sellers how to account for a change in the delineation of a time-share project or its phases. If the change results from a significant change in facts and circumstances about the project's development (e.g., major sales price or discount revisions, construction cost or inflation changes, temporary construction delays, design changes, or a shift toward more luxury units), it is a change in accounting estimate under Subtopic 250-10, recorded as a current-period adjustment per 978-330-35-1. If there is no such change in facts and circumstances, the change is a change in the method of applying an accounting principle under Subtopic 250-10.

ASC 330-10 governs the accounting for inventory: inventory is initially measured at cost (all expenditures and charges, direct and indirect, incurred to bring an article to its existing condition and location), with fixed production overhead allocated based on normal capacity and unallocated overhead, abnormal freight, handling, and spoilage expensed as incurred. Cost may be assigned using FIFO, average cost, LIFO, standard cost, or the retail inventory method, chosen to most clearly reflect periodic income and applied consistently. Subsequent measurement is bifurcated: inventory measured under LIFO or the retail inventory method uses lower of cost or market, while all other inventory (FIFO, average cost) uses lower of cost and net realizable value.

ASC 330-905 applies Inventory guidance to the agricultural industry, covering producers (growing crops, developing animals, harvested crops, livestock held for sale, secondary products), pooling cooperatives, and cooperative patrons. Direct and indirect costs of growing crops are accumulated until harvest, with pre-planting costs deferred and post-harvest cultural costs estimated and accrued to the harvested crop. Harvested crops and animals held for sale may be carried at net realizable value if they have a reliable, readily determinable market price, insignificant and predictable disposal costs, and immediate availability for delivery; otherwise Subtopic 330-10 measurement applies.

ASC 330-908 governs inventory accounting for airlines, where "inventory" consists of expendable spare parts, materials, and supplies held for internal consumption rather than sale. Expendable parts are recorded at cost in a current asset account akin to a prepaid expense, carry an allowance for obsolescence tied to the lives of the related fleets, and are charged to expense as used.

ASC 330-910 was the inventory guidance specific to construction contractors, addressing how contractors accounted for inventoried costs (e.g., uninstalled materials and precontract costs) under Topic 330. All of its substantive paragraphs — Sections 05 (Overview and Background), 15 (Scope), 25 (Recognition), and 40 (Derecognition) — were superseded by Maintenance Update No. 2019-01, so the subtopic contains no operative guidance. Contractors now look to the general inventory guidance in Topic 330 and to the revenue and contract cost guidance in Topics 606 and 340-40.

This Subtopic gives government contractors narrow guidance on inventory affected by contracts terminated for the convenience of the government, plus disclosure of the accounting policy for costs included in contract inventory. If inventory whose costs are in the termination claim is later reacquired by the contractor, the reacquisition value is recorded as a purchase; in "no-cost settlements," where the contractor waives its claim, no sale transaction arises and retained inventory is accounted for under ordinary inventory methods rather than as a purchase.

This subtopic applies inventory accounting to film production and distribution entities that hold physical products for sale, such as videocassettes and digital video discs. Its core rule is that at each balance sheet date the entity must evaluate these product inventories for net realizable value and obsolescence exposure and record appropriate adjustments (330-926-35-1). Scope follows the Entertainment—Films Overall Subtopic scope in Section 926-10-15.

This subtopic governs how mining entities account for stripping costs — the costs of removing overburden and waste materials to access ore — incurred during the production phase of a mine. The core rule is that post-production-phase stripping costs are variable production costs that must be capitalized into the cost of the inventory (ore) extracted in the same period the stripping costs are incurred. Stripping costs incurred before the production phase (i.e., during development) are outside the scope of this subtopic.

This Subtopic governs inventory accounting for entities in the oil and gas (extractive activities) industry, borrowing the scope of ASC 932-10-15. Its core rules are prohibitions: energy trading contracts that are not derivatives under Topic 815 may not be subsequently measured at fair value through earnings, and physical inventories may not be measured at fair value unless another Topic permits it. Exchanges (buying and selling inventory with the same counterparty) are directed to ASC 845-10-15-5 through 15-9.

This Subtopic sets the inventory-related disclosure requirements for entities engaged in retail land sales operations, focusing on future expenditures for land improvements. Entities must disclose the estimated total costs and timing of improvement expenditures for major selling areas for each of the five years after the balance sheet date, plus any recorded obligations for improvements (330-976-50-1).

ASC 330-978 governs how time-share sellers measure time-sharing inventory (intervals) and cost of sales. Sellers must use the relative sales value method, applied phase by phase, with common costs (including amenities) allocated among benefited phases, and must recalculate total estimated time-sharing revenue and total costs at least quarterly. Changes in estimate are recorded as current-period adjustments, and rental/other activity during the holding period is treated as incidental operations that reduce the pool of inventory costs.

This subtopic governs how a software vendor accounts for the costs of producing physical copies of software to be sold, leased, or otherwise marketed. Costs of duplicating the software, documentation, and training materials from the product masters and of physically packaging the product for distribution are capitalized as inventory on a unit-specific basis (330-985-25-1). Those capitalized costs are charged to cost of sales when revenue from the sale of the related units is recognized (330-985-40-1).

ASC 340-10 is the Overall subtopic for Other Assets and Deferred Costs, applicable to all entities. Its substantive guidance is limited to (1) describing prepaid expenses — amounts paid in advance (insurance, interest, rents, taxes, unused royalties, prepaid advertising service, operating supplies) that are used up within the normal operating cycle and classified as current assets — and (2) the recognition rules for preproduction design and development costs incurred under long-term supply arrangements. Costs deferred under other regimes (loan origination costs, internal-use software, environmental costs, broker-dealer and industry costs) are addressed by other Topics cross-referenced in Section 60.

ASC 340-970 (the Real Estate Project Costs Subsections) governs when costs of real estate projects may be capitalized, how they are subsequently measured and amortized, and when they must be written off. Preacquisition costs are capitalized only if directly identifiable with a specific property, capitalizable if the property were owned, and acquisition is probable; option payments are always capitalized. Once a project is substantially completed and held available for occupancy, carrying and rental operating costs are expensed, depreciation begins, and capitalized rental costs are amortized.

This Subtopic governs deferred cost recognition for real estate time-sharing activities. The default rule is that all costs incurred to sell time-sharing intervals are expensed as incurred unless they qualify for capitalization as incremental costs of obtaining a contract under 340-40-25-1 through 25-4. Seller financing costs (e.g., loan origination costs) follow Subtopic 310-20, and incremental costs to rent units during holding periods are deferred and then expensed (or netted against inventory) when the rental occurs.

ASC 360-10 governs the accounting for property, plant, and equipment and, in separate "Impairment or Disposal of Long-Lived Assets" Subsections, the impairment testing of long-lived assets held and used and the measurement, presentation, and disclosure of long-lived assets to be disposed of. Cost (including capitalized interest) is allocated to periods through systematic and rational depreciation (360-10-35-4). A held-and-used asset group is written down only if its carrying amount fails an undiscounted cash flow recoverability test, and then only down to fair value (360-10-35-17); held-for-sale assets are measured at the lower of carrying amount or fair value less cost to sell and are not depreciated (360-10-35-43).

ASC 360-905 governs how agricultural producers account for property, plant, and equipment — land development, orchards/groves/vineyards, intermediate-life plants, and animals. The core rule is that development costs (permanent and limited-life land development, cultural costs of trees and vines, and direct and indirect costs of developing animals) are capitalized during the development period; permanent land development is never depreciated because it has an indefinite life, while limited-life development, plantings, and mature breeding/production animals are depreciated over estimated useful or productive lives beginning when commercial production or maturity is reached.

ASC 360-908 governs property, plant, and equipment accounting unique to airlines: unit versus group depreciation, rotable parts, airframe modifications, and airframe/engine overhauls. Its core rules are that modifications enhancing an aircraft's usefulness must be capitalized and depreciated over the shorter of the aircraft's or the modification's useful life, and that overhauls must be accounted for under one of three permitted methods—direct expensing, built-in overhaul, or deferral—with the accrue-in-advance (accrual) method prohibited.

ASC 360-910 was the construction-contractor-specific guidance on property, plant, and equipment, but every substantive paragraph (05-1, 15-1, 25-1, and 35-1) was superseded by Maintenance Update No. 2019-01. The subtopic is now an empty shell containing no operative recognition, measurement, or scope guidance. Contractors therefore apply the general PP&E guidance in ASC 360-10 (and, for contract accounting, ASC 606 and ASC 340-40).

This subtopic governs how cable television entities account for plant and installation costs during the "prematurity period" — the span between the start of construction/marketing and the point at which the system is substantially complete and serving subscribers. Management must fix the prematurity period before revenue from the first subscriber is recognized (presumed not to exceed two years), capitalize cable plant costs and initial subscriber installation costs in full during that period, and record depreciation using a subscriber-based fraction rather than full depreciation. Distinguishable portions of a system in the prematurity period are accounted for and tested for recoverability separately.

This Subtopic gives mining-specific guidance on accounting for mineral rights and mining assets within Property, Plant, and Equipment. It clarifies that undeveloped land does not qualify for interest capitalization, how mineral resource asset current costs are measured when current cost disclosures are provided, and—most importantly—that impairment cash flow estimates for mining assets must include value beyond proven and probable reserves (with the related development and extraction outflows) and must reflect market-participant assumptions about mineral price fluctuations.

This subtopic governs how oil and gas entities capitalize, amortize, impair, and dispose of industry-specific property, plant, and equipment—mineral interests in properties, wells and related equipment and facilities, support equipment and facilities, and uncompleted wells—under the successful efforts method (full cost accounting is left to SEC literature). Only exploration and development costs that relate directly to specific oil and gas reserves are capitalized; other costs are expensed, and exploratory well costs are held in uncompleted wells pending a determination of whether proved reserves were found. Capitalized proved property and well costs are amortized by the unit-of-production method, unproved properties are periodically assessed for impairment via a valuation allowance, and conveyances of mineral interests generally produce no gain when they are poolings of assets or involve substantial future performance obligations.

This Subtopic addresses how depository and lending institutions (banks, savings institutions, credit unions) present property, plant, and equipment in their financial statements. Premises and equipment are generally reported as a single balance sheet caption, net of accumulated depreciation and amortization, with the accumulated amount shown on the face of the balance sheet or in the notes. Net gains or losses on disposition of premises and equipment go into noninterest income or noninterest expense rather than a separate line.

This subtopic tells insurance entities how to account for and report real estate. Real estate is classified by predominant use as either a real estate investment or real estate used in the business, and real estate acquired in settling mortgage guaranty and title insurance claims is a third, separately reported category measured initially at fair value (investments are measured at cost, then cost less accumulated depreciation). Depreciation and impairment charges follow the balance sheet classification — investment income/realized gains and losses for investments, and adjustments to claim costs incurred for real estate acquired in settling claims.

This industry subtopic addresses how health care entities present property that is held for investment purposes rather than used in operations. Its single substantive rule is that such property is reported as part of investments (360-954-45-1), not within operating property, plant, and equipment. Its scope follows the health care entities Overall Subtopic scope in Section 954-10-15.

This subtopic governs long-lived tangible assets held by not-for-profit entities, including contributed property, plant, and equipment and collection items. Its core rules are that all NFPs must recognize depreciation on long-lived tangible assets (360-958-35-1), that contributed PP&E is recognized under the Contributions Received Subsections of 958-605 with initial measurement including all costs to place the asset in use (360-958-30-1), and that an NFP holding a "collection" may elect one of three policies—full capitalization, prospective capitalization, or no capitalization—but capitalizing selected items is precluded (360-958-25-3).

This Subtopic governs how a defined benefit pension plan accounts for property, plant, and equipment it uses in operating the plan (buildings, equipment, furniture and fixtures, leasehold improvements). Unlike plan investments, which are generally reported at fair value, these operating assets are presented at cost less accumulated depreciation or amortization (360-960-35-1). The rationale is that expenditures for operating assets are advance payments for future administrative services rather than investments expected to generate cash flows to pay benefits (360-960-35-2).

This subtopic governs how a defined contribution pension plan accounts for property, plant, and equipment that the plan itself uses in its operations. The core rule is that such operating assets — buildings, equipment, furniture and fixtures, and leasehold improvements — are reported at cost less accumulated depreciation or amortization, rather than at fair value like investment assets.

This subtopic tells health and welfare benefit plans how to measure property, plant, and equipment on the plan's financial statements. Assets used in plan operations (buildings, equipment, furniture and fixtures, leasehold improvements) are carried at cost less accumulated depreciation or amortization, while real estate and other holdings held as plan investments are reported at fair value less costs to sell, if significant, as of the financial statement date.

ASC 360-970 gathers the real estate–specific property, plant, and equipment guidance in two sets of subsections: Real Estate Syndication and Real Estate Project Costs. It requires costs clearly associated with the acquisition, development, and construction of a real estate project to be capitalized and then allocated to project components (by specific identification, then relative fair value/sales value, then area methods), addresses donated and abandoned real estate and changes in use, and applies the Subtopic 360-10 impairment model project by project. For syndications, fees paid to and rentals received from a developer-seller under a master leaseback are adjustments to the basis of the property.

This Subtopic tells regulated entities (utilities) how to account for property, plant, and equipment in three situations: plant abandonments, disallowances of costs of recently completed plants, and capitalization of an allowance for funds used during construction (AFUDC). When abandonment becomes probable, the asset's cost comes out of construction work-in-process or plant-in-service and a separate new asset is recorded — at full cost if a full return on investment is likely to be provided, or at the present value of expected future recovery revenues (discounted at the entity's incremental borrowing rate) if partial or no return is likely, with the shortfall and any probable, estimable disallowance recognized as a loss. When it becomes probable that part of the cost of a recently completed plant will be disallowed for rate-making purposes and the amount is reasonably estimable, that amount is deducted from the plant's reported cost and recognized as a loss.

ASC 410-10 is a purely navigational "Overall" subtopic within the Asset Retirement and Environmental Obligations Topic. Its sole purpose is to explain the difference between Subtopic 410-20 (asset retirement obligations, the associated asset retirement cost, and environmental remediation liabilities arising from normal operation of a long-lived asset) and Subtopic 410-30 (environmental remediation liabilities generally). It contains no independent recognition or measurement rules.

ASC 470-40 governs product financing arrangements — transactions in which a "sponsor" arranges for another entity to buy and hold inventory on its behalf (or controls the disposition of such product) with a related commitment to buy it back at specified prices covering the other entity's financing and holding costs. Because the sponsor is in substance the owner of the product, the arrangement is accounted for as a borrowing rather than a sale: the sponsor records the inventory as an asset and a corresponding liability when the other entity buys the product (470-40-25-1 through 25-2). After ASU 2014-09, sale-and-repurchase legs are handled under Topic 606, leaving this Subtopic focused on purchases made by another entity on the sponsor's behalf.

ASC 610-30 governs the accounting when a nonmonetary asset (property, equipment, inventory) is involuntarily converted into monetary assets — e.g., insurance proceeds from destruction or theft, or condemnation awards in eminent domain. Because the conversion is a monetary transaction rather than a nonmonetary exchange, any difference between the asset's cost (or carrying amount) and the monetary assets received is a realized gain or loss that must be recognized, even if the proceeds are reinvested or the entity is obligated to reinvest them in replacement assets (610-30-25-2; 610-30-25-3).

ASC 705-10 is a "pointer" subtopic: it contains almost no substantive rules of its own and instead links to the Topics where cost of sales and services guidance actually resides. This structure follows from the Codification's asset liability model, under which costs are recognized as assets are sold or remeasured (or liabilities incurred), so the guidance sits in Topics such as 330 (inventory), 360 (PP&E), 606/340-40 (customer contracts), and 718 (share-based payment).

ASC 705-20 governs how a customer (often a reseller) accounts for cash, credits, coupons, or vouchers received from a vendor. The default rule is that vendor consideration reduces the purchase price of the goods or services acquired (705-20-25-1), unless it is payment for a distinct good or service transferred to the vendor, a reimbursement of specific incremental costs incurred to sell the vendor's products, or reimbursement for the vendor's sales incentives offered directly to consumers. The Subtopic also prescribes systematic and rational recognition of volume/loyalty rebates payable under binding arrangements.

ASC 705-905 is a "link-only" subtopic: it contains no substantive rules of its own and simply directs agricultural cooperatives to the guidance elsewhere in the Agriculture topic on when unprocessed products received from patrons are charged to cost of goods sold. The core point is that a COGS charge (and the related liability to patrons) arises only when the cooperative's board of directors assigns an amount to those unprocessed products.

ASC 705-985 is a "links only" subtopic that points to the authoritative guidance elsewhere in the Codification on cost of sales and services for computer software. Its content is that amortization of capitalized software development costs for products marketed to others is charged to cost of sales or a similar expense category (per 985-20-45-1), while duplication/packaging costs are inventory costs under 985-330 and costs to keep software current with hardware revisions are addressed in 985-20-55-11 through 55-12.

ASC 720-30 governs when an accrual-basis taxpayer records a liability for real and personal property taxes and how much is charged to income in each period. Legal liability for such taxes generally attaches at a specific event date (assessment date, lien date, levy date, etc.) determined by state law, but the preferred accounting is a monthly accrual over the fiscal period of the taxing authority for which the taxes are levied. Accrued property taxes are current liabilities, and later revisions of estimated amounts run through the income statement.

ASC 720-45 governs the accounting for costs of business process reengineering (BPR) activities, including those bundled into information technology transformation projects (e.g., enterprise software installations). The core rule is that BPR costs—whether performed internally or by third parties—must be expensed as incurred, even when they are part of a project to acquire, develop, or implement internal-use software. When a bundled third-party consulting contract covers multiple activities, the contract price must be allocated among activities based on objective evidence of relative fair values.

ASC 720-908 governs how airlines account for route developmental costs, preoperating costs, and certain maintenance/overhaul costs. The core rule is expense-as-incurred: because route expansion is a normal, recurring activity in a deregulated environment with uncertain recoverability, these costs may not be capitalized. It also addresses the direct expensing method for overhauls and the cost of repairing rotables.

ASC 720-970 addresses when real estate project costs must be expensed rather than capitalized. Its core rules: internal costs of preacquisition activities for a property that will be an operating property at acquisition date are expensed as incurred (720-970-25-1), and indirect costs not clearly related to projects under development or construction — including general and administrative expenses — are charged to expense as incurred (720-970-25-3). The Subtopic defines "operating" property as one where major construction is substantially complete and the property is either available for occupancy upon tenant improvements or already income-producing (720-970-25-2).

This subtopic governs how a time-share seller accounts for other expenses of time-sharing activities — chiefly selling and marketing costs and subsidies of the owners association. The core rule is that all costs incurred to sell time-sharing intervals are expensed as incurred unless they qualify for capitalization as costs to obtain a contract under ASC 340-40-25-1 through 25-4, and seller payments of dues, maintenance fees, or subsidies of owners association losses are likewise expensed as incurred.

ASC 730-10 governs the identification and accounting for research and development (R&D) costs. The core rule is that R&D costs within scope are charged to expense when incurred (730-10-25-1), because future benefits are too uncertain and unmeasurable to support asset recognition (730-10-05-2 through 05-3). The subtopic also defines which activities count as R&D, which cost elements are R&D costs, and requires disclosure of total R&D expense for each income statement period.

This Subtopic tells a time-sharing developer-seller how to account for special-purpose entities (SPEs) it establishes in connection with selling time-sharing intervals. If the SPE structure is legally required by the jurisdiction in order to sell intervals to nonresident customers and the SPE holds no assets other than the time-sharing intervals and has no debt, the SPE is viewed as lacking economic substance and existing solely to facilitate sales; the seller then reports the unsold interests in the SPE as time-sharing inventory on its balance sheet rather than applying consolidation or equity/cost method accounting. All other SPEs are evaluated under the normal consolidation, VIE, and investment models.

ASC 835-20 requires interest cost incurred while a qualifying asset is being readied for its intended use to be capitalized as part of the asset's historical cost, on the theory that such interest is an avoidable cost caused by the acquisition. Qualifying assets include assets constructed for an entity's own use, discrete projects built for sale or lease, and equity-method investments in investees that have not yet begun planned principal operations; routinely mass-produced inventory, assets already in use or idle, and gift/grant-funded assets are excluded. The amount capitalized equals the capitalization rate (rate on specific new borrowing, then weighted average of other borrowings) applied to average accumulated expenditures, capped at total interest cost incurred in the period.

This Subtopic tells cable television entities how much interest cost to capitalize while a cable system is under construction during the "prematurity period." Interest is capitalized under Topic 835 by applying the capitalization rate from 835-20-30-3 through 30-4 to the average qualifying assets, capped at total interest incurred for that system in the period. Because part of the system is already in service earning revenue, only the accumulated expenditures exceeding the fraction in 922-360-35-3 of total estimated system cost qualify.

This subtopic applies the general interest capitalization rules of Subtopic 835-20 to oil- and gas-producing operations that use the full cost method. Costs already being depreciated, depleted, or amortized are treated as assets in use and do not qualify for interest capitalization, while unusually significant unproved properties and major development projects not yet being amortized and on which exploration or development is in progress do qualify. It also addresses pipeline advances made to encourage exploration, which fall within the imputation-of-interest exclusion in 835-30-15-3(b) unless the advance is in a Topic 606 contract with a customer.

This Subtopic governs how entities with regulated operations account for the financing cost of construction — the allowance for funds used during construction (AFUDC), which includes both a computed interest component and a designated cost of equity funds. When a regulator requires such capitalization, the rate-making amount (not the amount computed under Subtopic 835-20) is capitalized for financial reporting purposes, but only if subsequent inclusion in allowable costs for rate-making purposes is probable. The credit is reported in the income statement as other income, a reduction of interest expense, or both.

ASC 845-10 governs nonmonetary transactions — reciprocal exchanges of nonmonetary assets and nonreciprocal transfers of nonmonetary assets to owners or others. The default rule is that such transactions are measured at the fair value of the asset surrendered (or received, if more clearly evident) with gain or loss recognized (845-10-30-1), subject to three exceptions requiring carryover (recorded amount) accounting: fair value not determinable within reasonable limits, an exchange of product held for sale to facilitate sales to customers, or a transaction lacking commercial substance (845-10-30-3). Special subsections address purchases and sales of inventory with the same counterparty, barter credits, and exchanges involving boot.

ASC 905-10 is the Overall subtopic of the Agriculture Topic, setting out the background and scope for industry-specific accounting by agricultural producers, agricultural cooperatives, and patrons of those cooperatives. The Topic's guidance is organized into three Subsections—General, Cooperatives, and Cooperatives—Patrons—and provides only incremental industry guidance, so entities must also apply all other applicable GAAP (905-10-15-1). It covers inventories of agricultural producers and development costs of land, trees and vines, intermediate-life plants, and animals (905-10-15-5), but excludes timber growers, tropical pineapple and sugarcane growers, raisers of animals for competitive sports, and merchants/noncooperative processors (905-10-15-4).

ASC 908-10 is the Overall subtopic of the Airlines industry Topic; it lists the industry Subtopics (segment reporting, inventory, takeoff and landing slots, PP&E, compensation, other expenses, nonmonetary transactions) and describes the operating and accounting characteristics that make airlines distinctive. Its only substantive rule is scope: Topic 908 supplies incremental industry-specific guidance for airline entities, which must still comply with all other applicable GAAP (908-10-15-1). Background paragraphs highlight the complex revenue cycle (advance ticket sales, third-party sellers, refundable/exchangeable tickets), mobile flight equipment, maintenance programs, and flight-crew compensation.

ASC 910-20 governs how construction contractors account for contract costs, focusing on charging equipment and small tool costs to specific contracts. Equipment cost is allocated to contracts on a reasonable basis (time, hours of use, or mileage) using a "use rate" that considers equipment cost less salvage/rental, probable life, average idle time, and operating costs. It also requires disclosure of unapproved change orders and claims included in contract costs and of progress payments netted against contract costs.

ASC 922-10 is the Overall subtopic of the Entertainment—Cable Television Topic, which addresses accounting and reporting for costs and expenses of constructing and operating a cable television system (922-10-05-1). It applies to all entities in the cable television industry and provides only incremental industry-specific guidance, so those entities must also follow all other applicable GAAP (922-10-15-1 through 15-2). The Topic is organized into Subtopics covering intangibles/goodwill, property, plant, and equipment, other expenses, and interest.

ASC 930-10 is the Overall subtopic of the Extractive Activities—Mining Topic; it identifies which entities fall within the Topic's scope and supplies definitions of mining industry terms. The Topic contains six subtopics (Overall, Inventory, Property Plant and Equipment, Compensation—Retirement Benefits, Business Combinations, and Consolidation) and provides only incremental industry-specific guidance, so mining entities must also apply all other applicable GAAP. It applies to all mining entities except oil- and gas-producing entities, which follow Topic 932.

ASC 932-10 is the Overall subtopic of the oil and gas extractive activities Topic; it identifies which entities and activities fall within the industry guidance and supplies common industry definitions. It applies to all entities with oil- and gas-producing activities — the search for, acquisition of rights to, and construction/drilling/production activities needed to bring crude oil, natural gas, and synthetic-oil-source hydrocarbons to the surface (932-10-15-2A). The industry-specific Subtopics override the more general Codification Topics for the issues they address (932-10-05-3), and the Topic does not prohibit use of the full-cost method (932-10-15-4).

ASC 970-10 is the Overall subtopic of the Real Estate—General Topic; it maps the industry's guidance (statement of cash flows, equity method/joint ventures, other assets and deferred costs, PP&E, debt, other expenses, consolidation, interest) and sets the pervasive scope. The Topic supplies only incremental industry-specific guidance and applies to all entities with productive activities relating to real property, excluding property used primarily in the entity's non-real estate operations (970-10-15-3). Its guidance runs in three Subsections: General (real estate ventures, partnerships, joint ventures, tax increment financing entities), Real Estate Syndication (income recognition from syndication activities), and Real Estate Project Costs (acquisition, development, construction, selling and rental costs).

ASC 978-10 is the Overall subtopic for real estate time-sharing activities, describing the scope of the industry guidance and the transaction structures it covers. It applies to all entities that sell real estate time-share interests — fee simple sales, sales where title remains with or reverts to the seller, and reseller transactions — but not to time-sharing in other long-lived assets like cruise ships or corporate jets. It also supplies the tests for determining what constitutes real estate (including integral equipment) and requires that each phase of a time-share project be delineated at the outset and accounted for separately.