Companies Are Supposed to Write-Down Value of Assets If a Permanent

question 41

Multiple Choice

Companies are supposed to write-down value of assets if a permanent impairment of value or loss of utility occurs. If a company writes down its assets this year, the effect on: $\quad$$\quad$$\quad$$\text {This year's ROA}$ $\quad$$\text {Next year's ROA}$
A. $\quad\quad\quad\text { Increased }\quad\quad \quad \text { No change }$
B. $\quad \quad \quad \text { Decreased }\quad \quad \quad \text { No change }$
C. $\quad \quad \quad \text { Decreased }\quad \quad \quad \text { Decreased }$
D. $\quad \quad \quad \text { Decreased }\quad \quad \quad \text { Increased }$

• A)Option A
• B)Option B
• C)Option C
• D)Option D

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Definitions:

Petition

A petition is a formal written request, often signed by many people, appealing to authority in respect of a particular cause.

Articles of Confederation

The Articles of Confederation was the first constitution of the United States, in effect from 1781 to 1789, that provided a loose federation of sovereign states and a weak central government.

Voluntary Association

An organization formed by individuals who voluntarily come together to pursue common interests or goals.

Independent States

Sovereign entities that have control over their own territory, with the power to make and enforce laws, and engage in relations with other states.