Collections Are Works of Art That Have Been Excluded from the Definition

question 20

Multiple Choice

Collections are works of art that have been excluded from the definition of capital assets. Which of the following statements is NOT a criterion which must be met before works of art qualify as collections under Canadian accounting standards?

• A) It must be possible to establish a useful life for the works and an appropriate amortization period.
• B) They are held for public exhibition, education, or research.
• C) They are protected, cared for, and preserved.
• D) They are subject to organizational policies that require any proceeds from their sale to be used to acquire other items for the collection, or for the direct care of the existing collection.

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Definitions:

After-Tax Income

The amount of net income left after all taxes have been deducted, representing the actual income available to the individual or business.