The Proper Accounting for Natural Resources Is to Record the Original

question 283

Multiple Choice

The proper accounting for natural resources is to record the original cost as an:

• A)asset,then later transfer amounts to Inventory as the resource is depleted,and finally expense the cost as the resources are sold.
• B)asset,then expense the cost over its useful life.
• C)expense in the period purchased.
• D)asset,and then expense the cost over its useful life using straight-line depreciation.

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Definitions:

Stock Split

A corporate action in which a company divides its existing shares into multiple shares to boost the liquidity of the shares, though the overall value of one's holdings remains the same.

Shareholder Wealth

The total value of a shareholder's equity in a company, taking into account the current market value of shares owned.

Trading Range

A price range in which stocks are thought to appeal to the widest variety of investors. Typically between $30 and $100. Stock splits function to keep prices within a trading range when the stock is appreciating.

Small Investors

Individuals who commit capital to investments in smaller amounts compared to institutional investors, often with less access to sophisticated tools and information.