In Accounting for Tangible Operational Assets, the Continuity Assumption Is

question 137

Multiple Choice

In accounting for tangible operational assets, the continuity assumption is important because of which of the following?

• A) It helps a company decide whether to use straight-line depreciation or an accelerated depreciation method.
• B) It justifies depreciating the asset over its expected useful life, without anticipating that the business will liquidate in the near future.
• C) It provides justification for including residual values in calculating depreciation.
• D) It is consistent with maintaining assets in the accounting records at market value rather than acquisition cost.

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Definitions:

Hybridization

The concept in chemistry where atomic orbitals mix to form new hybrid orbitals, which are suitable for the pairing of electrons to form chemical bonds in molecular compounds.

Nitrogen Atom

A chemical element with the symbol N and atomic number 7, known for its role in the formation of amino acids, nucleic acids, and many other organic and inorganic compounds.

Negatively Skewed

A characteristic of a distribution where the tail on the left side of the distribution is longer or fatter than the right side, indicating that the bulk of the values lie to the right side.

Median

The middle value in a sorted list of numbers, dividing the data into two halves.