The Debt Service Ratio Is the Ratio of

question 7

Multiple Choice

The debt service ratio is the ratio of

• A)external debt to the size of the service sector.
• B)external debt to total GNP.
• C)internal debt to the size of the service sector.
• D) internal debt to total GNP.
• E) none of the above.

Differentiate between amortization, depreciation, and depletion and their related concepts.

Recognize the conditions under which goodwill can be recorded.

Calculate and understand the concept of depletion and its application to natural resources.

Comprehend the treatment of costs associated with defending intangible assets.

---

Definitions:

Gain Reported

The difference reported in financial statements when the sale price of an asset exceeds its book value.

Carrying Amount

The book value of an asset or liability on a company's balance sheet, calculated as its original cost minus depreciation, amortization, or impairment costs.

Disposal of an Asset

The process of selling, scrapping, or otherwise removing an asset from the company's balance sheet due to its disposal, sale, or obsolescence.

Depreciation Recorded

The process of allocating the cost of a tangible asset over its useful life to account for the loss of value over time.