When a Company Wants to Place a Value on a Physical

question 24

Multiple Choice

When a company wants to place a value on a physical asset for its balance sheet,it must

• A) reduce the value by the amount the asset has depreciated.
• B) auction the asset off.
• C) ask its competitors what the asset is worth.
• D) price a new one.
• E) increase the value by the amount the asset has appreciated.

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Definitions:

Break-Even Time

The period required for an investment, project, or business to generate enough income to cover its initial cost, reaching a point where there are no net losses or gains.

Highest Rank

The top position or level in an organizational hierarchy or system.

Payback Period

The amount of time it takes for an investment to generate an amount of income or cash equal to the cost of the investment.

Unprofitable Investment

An investment that generates a financial loss or does not achieve the expected financial return.