An ASP Provides More Than a License to Use a Software

question 60

True/False

An ASP provides more than a license to use a software application;it rents an operational package to the customer.

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Definitions:

Depreciation Expense

The distribution of a physical asset's cost over its lifespan, which mirrors the reduction in its value as time progresses.

Comparative Balance Sheet

Financial statements that present the balances of assets, liabilities, and equity at different points in time for comparison purposes.

Indirect Method

An approach to report cash flows from operating activities on the cash flow statement, adjusting net income for changes in non-cash accounts.

Operating Activities

Activities that constitute the primary or main operations of a company, including sales, service, and administrative functions, as reflected in the cash flow statement.