Java Cafes, Inc

question 14

Multiple Choice

Java Cafes, Inc., and Kaffe Import Corporation dispute a term in their contract.
-Refer to Fact Pattern 3-1.If Java and Kaffe have a long-standing business relationship that they would like to continue,a preferred method of settling their dispute may be mediation because

• A)the case will be heard by a mini-jury.
• B)the dispute will eventually go to trial.
• C)the process is not adversarial.
• D)the resolution of the dispute will be decided an expert.

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Definitions:

Book Value

The value of an asset as reported on a company's balance sheet, calculated as the cost of the asset minus any accumulated depreciation.

Impairment Model

Impairment Model is an accounting method that requires assets to be reviewed for impairment, whereby their carrying value is adjusted to reflect their recoverable amount if this is less than their current book value.

Indefinite-Lived Assets

Non-physical assets without a predefined expiry date in terms of economic benefits or usefulness.

Amortization

The systematic reduction of a loan or the spreading out of capital expenses for intangible assets over a specific period of time for accounting and tax purposes.