The FASB and the IASB Are Reconsidering the Definition of an Asset

question 171

True/False

The FASB and the IASB are reconsidering the definition of an asset and the criteria for asset recognition.

---

Definitions:

Return On Investment

A measure of the profitability of an investment, calculated as the net profit from the investment divided by the cost of the investment.

Residual Income

The amount of income that an individual or business has after all personal debts and expenses, including the cost capital, have been paid.

Financial Performance

An indicator of how well an entity can use assets from its primary mode of business and generate revenues.

Residual Income

A measure of performance that calculates the income an investment generates above the minimum required return.