Talk Time Communications Is Considering the Purchase of a New

question 279

Multiple Choice

Talk Time Communications is considering the purchase of a new satellite. The firm believes the satellite will help generate future earnings. In addition, the firm recognizes the tax benefits of a lower net income provided by the annual ________ of the asset.

• A) inventory valuation
• B) declining balance
• C) appreciation
• D) depreciation

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Definitions:

Balance Sheet

A financial report detailing a company's assets, liabilities, and equity at a particular moment, serving as a foundation for calculating return rates and assessing its financial structure.

Administration Expenses

Expenses related to the general operation of a business, including executive salaries, HR, and IT, not directly tied to the production or selling of goods/services.

Operating Expense

Expenses that a business incurs through its normal business operations, often excluding the cost of goods sold, financing costs, and taxes.

Income Statement

A document presenting a business's income and outgoings within a set timeframe, leading to a declaration of either profit or loss.