The Disposal Value at the Date of Termination of a Project

question 16

Multiple Choice

The disposal value at the date of termination of a project is:

• A) a decrease in the cash outflow in the year acquired
• B) an increase in the cash inflow in the year of disposal
• C) an increase in the cash outflow in the year of disposal
• D) a decrease in the cash inflow in the year acquired

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Definitions:

Drawing

The account used to record amounts withdrawn by an owner of a proprietorship.

Closing Entry

Journal entries made at the end of an accounting period to transfer temporary account balances to permanent accounts, clearing out revenues and expenses for the next period.

Wages Expense

The total cost incurred by a company for paying its employees, often reflected as an operating expense on the income statement.

Rent Expense

The cost incurred by a business to utilize property or equipment for operations, which is recorded as an expense on the income statement.