Use the Table for the Question(s)below

question 53

Multiple Choice

Use the table for the question(s) below.
Statement of Financial Position

-The above diagram shows a statement of financial position for a certain company.All quantities shown are in millions of dollars.How would the balance sheet change if the company's long-term assets were judged to depreciate at an extra $5 million per year?

• A)Net property,plant,and equipment would rise to $126 million,and Total Assets and Stockholders' Equity would be adjusted accordingly.
• B)Net property,plant,and equipment would fall to $116 million,and Total Assets and Stockholders' Equity would be adjusted accordingly.
• C)Long-Term Liabilities would rise to $182 million,and Total Liabilities and Stockholders' Equity would would be adjusted accordingly.
• D)Long-Term Liabilities would fall to $172 million,and Total Liabilities and Stockholders' Equity would be adjusted accordingly.
• E)Net property,plant,and equipment would be unchanged,and Total Assets and Stockholders' Equity would also remain the same.

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Definitions:

Fiduciary Duty

An obligation one party (fiduciary) has to act in the best interest of another (the principal) in situations that require trust, honesty, and loyalty.

Compete

To engage in an effort to win or achieve something, such as business or market share, by excelling over others.

Reimbursed

To be reimbursed means to receive repayment for money that has been spent or lost, usually as a result of conducting business or performing tasks on behalf of another.

Apparent Authority

A situation where a person appears to have been given the power to act on behalf of another, even if no actual authority was granted.