If a Client Expensed the Acquisition Cost of Some Assets

question 63

Multiple Choice

If a client expensed the acquisition cost of some assets that should have been capitalized and depreciated them over their useful lives, which of the following would be incorrect?

• A) A qualified opinion would be appropriate.
• B) The opinion paragraph should be modified to include language such as: "except for the effects of not capitalizing the acquisition costs of some assets.."
• C) An explanatory paragraph should include the effects of the subject matter of the qualification, where practicable.
• D) An explanatory paragraph should be modified to include language such as: "subject to the qualified act.."

---

Definitions:

Least Costly Way

Refers to a method or strategy that aims to achieve a particular goal or produce a specific outcome with the minimum possible expense or use of resources.

Inferior Good

A type of good for which demand decreases as the income of consumers increases, inversely related to income elasticity.

Demand

The amount of a product or service that consumers are prepared and capable of buying at different price levels over a specific time frame.