Fixed Asset Accounting

question 78

Multiple Choice

Fixed asset accounting

• A)ensures that payroll and employment taxes are kept current.
• B)automatically calculates and accumulates depreciation.
• C)records if your business keeps surplus cash invested in securities.
• D)records if your business has made improvements to leased property or equipment.

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Definitions:

Perpetual Inventory System

An accounting approach that continuously updates inventory records after each transaction, providing a real-time view of inventory levels.

Liability Credited

A credit entry in accounting representing an increase in liabilities, reflecting that a company has received something of value for which it must pay in the future.

Asset Debited

An accounting entry that increases the value of an asset account.

F.O.B. Destination

A shipping term indicating that the seller bears the shipping costs and maintains ownership and responsibility for the goods until they are delivered to the buyer's specified location.