Which of the Following Transactions Is Consistent with Recognizing Value

question 29

Multiple Choice

Which of the following transactions is consistent with recognizing value changes on the balance sheet and income statement when they are realized in a market transaction?

• A) Selling land at a cost greater than its original purchase price.
• B) Recording an increase in the fair value of investments at year end.
• C) Translating foreign operations accounted for in Yen back to U.S.dollars in order to prepare consolidated financial statements.
• D) Writing down the value of an asset due to obsolescent.

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Definitions:

Marginal Product of Labor

The additional output a firm produces as a result of hiring one more worker.

Profit-Maximizing

Profit-maximizing refers to strategies or actions taken by businesses to increase their profits to the highest possible level given their resources and market conditions.

Competitive

Characterized by rivalry where entities strive to gain an advantage or win a contest.

Envelopes

Paper or other material covers used to enclose letters or documents, typically for mailing or storage purposes.