Which of the Following Is not True for an Operating

question 77

Multiple Choice

Which of the following is not true for an operating expenditure?

• A)It is recorded with a debit to a statement of financial position account.
• B)It benefits the current period only.
• C)It is incurred to maintain an asset in its normal operating condition.
• D)It often recurs.

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Definitions:

Expected Value Analysis

A statistical technique used to calculate the average outcome when the future includes scenarios that may or may not happen.

Sensitivity Analysis

The process of analyzing the impact of varying key assumptions or input variables on the outcome of a decision or model.

Annual Net Cash Flow

The difference between a company's total cash inflows and outflows over one fiscal year, reflecting its ability to generate cash.

Average Rate Of Return

A method of evaluating a capital investment proposal that focuses on the expected profitability of the investment; computed as average annual income divided by average investment. Also referred to as accounting rate of return.