Intangible Assets

question 40

Multiple Choice

Intangible assets

• A)Are rights,privileges,and competitive advantages to the owner,used in operations,having no physical substance
• B)Include patents,leaseholds,and land improvements
• C)Can be amortized
• D)Are rights,privileges,and competitive advantages to the owner,used in operations,having no physical substance and can be amortized
• E)All of these

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Definitions:

Financial Risk

The possibility of losing money on an investment or business venture due to various financial factors.

Return on Assets

An indicator of how profitable a company is relative to its total assets, calculated as net income divided by total assets.

M&M Proposition II

A theory proposing that the value of a firm is unaffected by its capital structure, assuming no taxes and that investment returns are required to increase with leverage.

Cost of Equity

The rate of return that a company is expected to pay to its shareholders to compensate them for the risk of investing in the equity of the company.