Which of the Following Is an Essential Requirement for an Asset

question 21

Multiple Choice

Which of the following is an essential requirement for an asset to exist for accounting purposes?

• A) An asset must be tangible.
• B) An asset must have been exchanged for another asset.
• C) An asset must be under the control of the entity.
• D) An asset must have been acquired at a cost to the entity.

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Definitions:

Specific Performance

A court order compelling a party to execute a contract according to its precise terms when monetary compensation is inadequate.

Picasso Painting

An artwork created by Pablo Picasso, a Spanish painter and sculptor known for co-founding the Cubist movement.

Purchase of Light Bulbs

The act of acquiring light bulbs through buying, which involves selecting the desired type, wattage, and technology (like LED, incandescent).

Four-Ply Construction

A method of constructing materials or items with four layers, often used for added durability or insulation.