The Main Source of Collateral for Companies Like Accounting Firms

question 142

Multiple Choice

The main source of collateral for companies like accounting firms and law firms is

• A) cash flow.
• B) equipment and buildings.
• C) accounts receivable.
• D) accounts payable.
• E) goodwill

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Definitions:

Transferred Assets

Transferred assets are items of value such as property, plant, and equipment that are moved from one owner to another under terms of a transaction or agreement.

Depreciation Adjustments

Modifications made to the depreciation expense recorded for assets, reflecting changes in an asset’s estimated useful life or residual value.

Tax Effects

The impact of tax laws on the financial statements of a company, especially in terms of income tax expense and deferred tax assets and liabilities.

Intragroup Sale

Transactions of goods or services between companies within the same group, which may require elimination adjustments during consolidation.