A Bailment Exists When a Person

question 25

Multiple Choice

A bailment exists when a person

• A) swaps her mountain vacation rental cabin for another person's condo at the beach.
• B) leaves clothes at a dry cleaner's to be laundered.
• C) sells some furniture.
• D) allows his pool to be used on a regular basis by the neighbors.

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Definitions:

Fair Value

Fair Value is the estimated market value of an asset or liability, based on current conditions and comparable transactions.

Asset Turnover Ratio

A financial metric that measures the efficiency of a company's use of its assets in generating sales revenue; the higher the ratio, the more efficiently assets are being used.

Additions And Improvements

Costs incurred to increase the operating efficiency, productive capacity, or useful life of a plant asset.

Accumulated Depreciation

The total depreciation expense that has been charged against an asset since it was acquired.