GAAP Requires That, When Recording Amortization Expense, the Credit Must

question 136

True/False

GAAP requires that, when recording amortization expense, the credit must always be made to a contra asset account, rather than directly to the asset account.

---

Definitions:

Expected Rate Of Return

A calculation representing the probable return on an investment, accounting for the risk of different investment options and the likelihood of various outcomes.

Marginal Cost

The extra expenditure required to produce one additional unit of a product or service.

Marginal Benefit

Marginal Benefit is the additional satisfaction or utility gained by consuming one more unit of a good or service.

Expected Profitability

The forecasted return on investment for a business activity or project, considering potential profits and losses.