Match the Proper Deduction Method with the Correct Expenditures

question 85

Multiple Choice

Match the proper deduction method with the correct expenditures.
-Start-up costs over $5,000.

• A)Capitalized and amortized over a number of accounting periods
• B)Expensed in the period incurred
• C)Not deductible
• D)Can be capitalized and amortized or deductible depending on the amount of the expenditure

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Definitions:

Share Options

Financial derivatives that give the holder the right, but not the obligation, to buy or sell shares of a stock at a specified price within a specified time.

Promotion

Marketing activities aimed at increasing awareness, interest, and sales of a product or service.

Sales Margin

The difference between the sales revenue of a product and the cost of goods sold, expressed as a percentage of the sales revenue, indicating profitability.

Capital Turnover

A metric that evaluates how effectively a business leverages its capital to produce income.