The Cost of an Asset and Its Fair Market Value

question 166

Multiple Choice

The cost of an asset and its fair market value are

• A) never the same.
• B) the same when the asset is sold.
• C) irrelevant when the asset is used by the business in its operations.
• D) the same on the date of acquisition.

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Definitions:

Mutagen

An agent, such as radiation or a chemical substance, that causes genetic mutation.

Carcinogen

is any substance, radionuclide, or radiation that promotes carcinogenesis, the formation of cancer, by altering cellular metabolism or damaging DNA directly in cells.

Stock Split

A corporate action that increases the number of a company's shares by issuing more shares to current shareholders, thus reducing the price per share.

Common Stock Dividend

A portion of a company's earnings distributed to shareholders of its common stock, typically in the form of cash or additional shares.