Buying a Cup of Coffee for a Friend Is an Example

question 55

Multiple Choice

Buying a cup of coffee for a friend is an example of _________.

• A)balanced exchange
• B)unbalanced exchange
• C)redistribution
• D)theft
• E)none of the above

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Definitions:

Depreciation Expense

The cost allocated to reflect the reduction in value of a tangible asset over its useful life, as part of the wear and tear or obsolescence.

Depreciation

A method of allocating the cost of a physical or tangible asset over its expected usable life to account for decreases in value over time.

Residual Value

The estimated value that an asset will realize upon its sale at the end of its useful life.

Asset Cost

The total amount incurred to acquire an asset, including purchase price and all expenditures necessary to bring the asset to its intended use.