Which of the Following Is Not True Regarding Long-Lived Assets

question 104

Multiple Choice

Which of the following is not true regarding long-lived assets with a finite life?

• A)The firm consumes the asset's services over time in generating revenues.
• B)The balance sheet carrying value decreases over time as the firm recognizes the cost of the asset as an expense.
• C)A portion of the acquisition cost is recognized as an expense each period.
• D)Management must estimate the asset's finite life.
• E)Remains on the balance sheet at net realizable value (unless an asset impairment occurs).

---

Definitions:

Variable Cost

Expenses that vary directly with the production output, such as materials and labor.

Processed Further

A decision-making situation in managerial accounting regarding whether to continue processing a product or material beyond its current stage in order to increase its value.

Intermediate Products

Products that are not the final goods but are used as inputs in the production of other goods or services.

Industrial Fiber

Fibers used in the manufacturing sector for the production of goods like textiles, composites, and other industrial materials.