Because of the ________ Effect, a Dollar Spent Will Contribute

question 13

Multiple Choice

Because of the ________ effect, a dollar spent will contribute two or three dollars of activity to the economy.

• A) distribution
• B) bullwhip
• C) butterfly
• D) accelerator

Determine the impact of depreciation and asset disposal on financial statements.

Understand how changes in depreciation methods or estimates affect financial statements.

Comprehend regulations and standards governing asset depreciation and disposal.

Understand the definition and legal treatment of copyrights and patents.

---

Definitions:

Fixed Asset

Tangible assets, like buildings, machinery, or vehicles, intended for use over a long period and not readily convertible into cash.

Rent Expense

The cost incurred by a business for leasing property or equipment used in operations, reflected as an expense on the income statement.

Double-Declining-Balance

An accelerated depreciation method that calculates depreciation at twice the rate of the straight-line method.

Depreciation

The systematic allocation of an asset's cost over its useful life, reflecting its decrease in value over time.