An Intangible Asset

question 47

Multiple Choice

An intangible asset

• A) derives its value from the rights and privileges it provides the owner.
• B) is a liability because it has no physical substance.
• C) is never amortized because it has an indefinite life.
• D) cannot be classified on the balance sheet because it lacks physical substance.

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Definitions:

Secretary of State

A high-ranking official in many governmental bodies who is typically in charge of foreign affairs or domestic records.

Borrow Money

The act of receiving funds from a lender under the agreement that the funds will be repaid, usually with interest, at a future date.

Winding Up

The process of dissolving a company, involving the selling of assets, paying off creditors, and distributing any remaining assets to shareholders.

Buyout Price

The agreed-upon amount for purchasing a company's or individual's share, often used in buy-sell agreements or mergers and acquisitions.