The Size of a Nonoperating Expense or One-Time Charge Mentioned

question 7

True/False

The size of a nonoperating expense or one-time charge mentioned in a management discussion and analysis (MD&A )note might determine if it should be included in the adjustment to NOPLAT.

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Definitions:

Amortize

To gradually write off the initial cost of an intangible asset over its useful life, reflecting the consumption of the asset's value.

Capital Assets

Long-term tangible or intangible assets owned or controlled by a business that are used to produce goods or services and are not intended for sale in the regular course of business.

Equity Method

An accounting technique used for recording investments in associate companies where the investment is represented by the equity value.

Cost Method

An accounting approach whereby investments are recorded at their original purchase cost, without adjusting for changes in fair value, except for impairments.