Which of the Following Is Not a True Statement Regarding

question 53

Multiple Choice

Which of the following is not a true statement regarding assets as they appear on the balance sheet?

• A)Historical cost gives a good indication of the productive value of assets.
• B)Assets held for sale and measured at net realizable value represent a high degree of certainty as to measurement reliability.
• C)Certain types of deferred charges do not have any direct effect on future cash flows.
• D)In terms of additivity, it is questionable if a balance sheet should be added.

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Definitions:

Legitimate Power

Authority that is officially granted to a leader or manager by an organization, recognized as rightful by those who are governed by it.

Authority

The power or right to give orders, make decisions, and enforce obedience.

Order

The arrangement or organization of people, tasks, or things following a particular sequence, pattern, or method.

Coercive Power

This refers to the ability of a person to force others to comply with orders or requests through threats, punishment, or negative consequences.