Recently,companies Have Been Ordered by Governmental Agencies to Clean Up

question 133

Multiple Choice

Recently,companies have been ordered by governmental agencies to clean up environmental damages caused by business operations.How should costs incurred in these situations be treated?

• A)If a legal obligation exists,the cost of restoring the property must be added to the asset account.
• B)They should be treated as an expense entirely in one accounting period.
• C)They should be treated as an amortized expense in the period the cost is incurred.
• D)They should be added to the asset and then depreciated over 15 years.

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Definitions:

Nutrients

Materials that supply the necessary nutrients for development and sustaining life.

Gases

States of matter consisting of particles that are significantly far apart and completely fill any container they are in, unlike solids and liquids.

Cardiac Output

The volume of blood the heart pumps through the circulatory system in one minute, an important measure of heart function and overall health.

Regulation

The control or maintenance of a process or function at a certain level or within certain limits.