Which of the Following Actions Is Not a Potential Fraud

question 18

Multiple Choice

Which of the following actions is not a potential fraud scheme related to long-lived assets?

• A)Impairment losses on long-lived assets are not recognized.
• B)Costs that should have been expenses are improperly capitalized.
• C)Amortization of intangible assets is miscalculated.
• D)All the above are potential fraud schemes.

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Definitions:

Plant Assets

Long-term tangible assets that are used in the production of goods or services and are not intended for resale, including buildings, machinery, and equipment.

Double-Declining Balance

An accelerated method of depreciation where an asset loses value at double the rate of traditional straight-line depreciation.

Depreciation Method

An accounting technique used to allocate the cost of a tangible asset over its useful life, reflecting its consumption, wear and tear, or obsolescence.

Adjusting Journal Entries

Entries made in the accounting records at the end of an accounting period to allocate income and expenditures to the period in which they actually occurred.