Which of the Following Is Not a Formal Definition of Assets

question 34

Multiple Choice

Which of the following is not a formal definition of assets that has been used by the accounting profession in the United States?

• A) Something represented by a debit balance that is or would be properly carried forward upon a closing of books of account according to the rules or principles of accounting, on the basis that it represents either a property right or value acquired, or an expenditure made which has created a property or is properly applicable to the future
• B) Economic resources of an enterprise that are recognized and measured in conformity with generally accepted accounting principles as well as certain deferred charges that are not resources but that are recognized and measured in conformity with generally accepted accounting principles
• C) Probable future economic benefits obtained or controlled by a particular entity as a result of past transactions or events
• D) Only those economic resources that can be severed from the firm and sold

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Definitions:

Control Environment

The control environment forms part of an organization’s internal control framework, setting the tone for discipline and structure regarding the internal controls and operational processes.

Risk Assessment

The process of identifying, analyzing, and evaluating the likelihood and impact of risks on a project or organization.

Control Procedures

Policies and procedures that are put in place by a company to ensure the integrity of financial and accounting information, promote accountability, and prevent fraud.

Beginning Balance

The amount of funds or value of an account at the start of a new financial period.