All of the Following Are Methods of Avoiding Capitalization Except

question 105

Multiple Choice

All of the following are methods of avoiding capitalization except:

• A) legal agreement.
• B) use of contingent rent.
• C) use of a third party.
• D) shorten the lease term.

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Definitions:

Adjusting Journal Entries

Entries made in accounting records to update balances at the end of an accounting period before financial statements are prepared.

Adjusted Cash Balance

A financial metric that reflects the amount of cash available after adjustments, often related to reconciling book and bank records.

Petty Cash Fund

A small amount of cash on hand used for minor or incidental expenses within a business.

Custodian

An individual or entity responsible for safeguarding assets, such as cash or securities, ensuring their safekeeping and proper use.