Managers of Some Entities Have Resisted Depreciating Buildings in Accordance

question 62

Multiple Choice

Managers of some entities have resisted depreciating buildings in accordance with IASB 16.Which of the following is the grounds given by directors for failing to act in compliance with IASB 16?

• A)Depreciating buildings when their values are generally increasing over time.
• B)Management is concerned that the effect on ratios such as the times interest-covered and debt/equity may lead to an entity breaching its debt covenants.
• C)Management considers that when the asset is sold the amount of gain or loss that will be reflected in the books will be incorrect.
• D)Depreciating buildings when their value is generally increasing does not make economic sense and management is concerned that the effect on ratios such as the times interest-covered and debt/equity may lead to an entity breaching its debt covenants.

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Definitions:

Promotional Mix

The combination of marketing tools used by a business to execute its promotional strategy, including advertising, sales promotion, public relations, and direct marketing.

Personal Selling

A direct marketing approach involving face-to-face sales presentations to potential buyers to persuade them to make a purchase.

Nonpersonal Selling

Marketing activities that do not involve face-to-face interactions, including advertising, social media marketing, and email marketing.

Perceived Quality

The customer's perception of the overall quality or superiority of a product or service compared to alternatives.