A Fixed Asset Is

question 167

Multiple Choice

A fixed asset is

• A) an amount due from a customer who has purchased goods on credit.
• B) an asset with long-term use or value,such as land,buildings,and equipment.
• C) an expense,such as rent,that is paid before the upcoming period in which it is due.
• D) an asset that can or will be converted to cash within the following year.
• E) a nonphysical asset,such as a patent or trademark,that has economic value in the form of an expected benefit.

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Definitions:

Dividend

A distribution of a portion of a company's earnings, decided by the board of directors, to a class of its shareholders.

Expense Matching

An accounting principle that states expenses should be recorded in the same period as the revenues they helped to generate, to accurately match income with expenses.

Cause and Effect

A relationship where one event (the cause) leads to the outcome of another event (the effect).

Systematic Allocation

The methodical distribution of costs or revenues across different accounts, periods, or projects to match expenses with related revenues.