Accounting Recognizes That Assets,such as Machinery and Buildings,lose Value Over

question 99

Multiple Choice

Accounting recognizes that assets,such as machinery and buildings,lose value over time.Accountants will record a portion of the cost of an asset as an expense each year through the use of:

• A)Asset valuation.
• B)Asset audits.
• C)Appreciation.
• D)Depreciation.

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Definitions:

Interest-Bearing Note

A promissory note with a specified interest rate, where the issuer agrees to pay the bearer interest in addition to repaying the principal amount at maturity.

Adjusting Entries

Accounting records finalized at the close of an accounting period to properly assign income and expenses to the period they truly belong to.

Annual Accounting Period

A 12-month time span used by businesses for financial reporting and accounting purposes.

Chart of Accounts

A systematic listing of all ledger account names and numbers used by a company, organized by the assets, liabilities, equity, revenue, and expenses.