1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
MAVERICK [17]
3 years ago
13

To what extent do cost recovery deductions based on the capitalized cost of a tangible asset reflect a decline in the economic v

alue of that asset?
Business
1 answer:
sladkih [1.3K]3 years ago
7 0

Answer:

Cost recovery deductions do not have relationship to any decline in value of the property to which the deduction relates.

Explanation:

Capitalised costs are the cost that is incurred when building and financing a fixed asset. For example labour cost in building and financing an asset.

These expenses are added to the cost of the asset (capitalised) and taken gradually over time through depreciation, depletion, and amortization. They are not taken out of revenue in the period when they were incurred.

So cost deductions through capitalised cost is not related to the value of the asset but is an expense that is incurred in relation to the asset, and it's payment is spread out over time.

For example if $1,200 is incurred on construction of an asset worth $500,000. If $1,200 is capitalised over 12 months $100 will be deducted each month from expense. This does not affect the value of the asset ($500,000).

You might be interested in
A vendor makes a new smartphone and presells four thousand units for $300 each. The factory has the capacity to produce one thou
Oksanka [162]

Answer:

2. Limited supply would increase the price

Explanation:

In the given case the vendor sells in advance four thousand units for $300. While the installed capacity of the factory being to produce 1000 smartphones every month.

Expected sales being 500 units per month.

During the first few months, since the seller has already successfully sold 4000 smartphone units, high demand for the smartphones is evident.

Since the supply is limited to 1000 units only in a month and the quantity demanded being more as is evident by 4000 units being pre sold, during the initial phase, this would create a high demand.

And since the supply is limited, the seller will have to increase the price as the demand is lot more.  

7 0
3 years ago
Mark exchanged an office building that he owned for over ten years for vacant land used by Sandy in her farming business. The of
hram777 [196]

Answer:

h

Explanation:

3 0
3 years ago
What are the four segments in a PEST analysis?
makvit [3.9K]
Political, economic, social and technological
5 0
3 years ago
Define cultural intelligence<br>How important is it terms of doing business globulty
Alex17521 [72]
Cultural Intelligence can be described as the capability of a person to relate and communicate to different cultures including his own. This can be very important in terms of doing global business involving different cultures. This intelligence can be used to analyze other cultural techniques and easily relate to them. 
4 0
3 years ago
Rather than generating tax revenue as do tariffs, subsidies require tax revenue. Therefore, they are not an effective protective
KatRina [158]

Yes. Subsidies are benefits that the government can grant to institutions, households and businesses to promote economic efficiency and reduce market failures. They may be distributed through cash or by cutting tax rates. However, there is controversy about the effectiveness of using subsidies for the economy, often related to the inefficiency of promoting a free market, allocating resources that could be used for investment in productive resources and masking the results of economic efficiency. Another major concern with the use of subsidies is the formation of political alliances of those who receive them and those who provide them, creating political interests because of their use.

6 0
3 years ago
Other questions:
  • Production costs activity use the table below with page 4 of the fasttrack to complete the activity. first shift capacity first
    10·1 answer
  • Phillips Equipment has 6,500 bonds outstanding that are selling at 96.5 percent of par. Bonds with similar characteristics are y
    15·1 answer
  • An agreement to settle a debt for less than the sum claimed is referred to as?
    9·1 answer
  • Jensen performed legal services to assist Balm Co. in accomplishing its initial organization. Jensen accepted 1,000 shares of $5
    12·1 answer
  • Adams is selling his property to Katter for $94,000, and Katter is assuming an existing mortgage at 4-1/2% interest per annum wi
    8·1 answer
  • True or False: The term “academic training” refers primarily to formal classes taken in school.
    8·2 answers
  • An october sales forecast projects 7,000 units are going to be sold at a price of $11.50 per unit. the desired ending inventory
    9·1 answer
  • She never drink change into how often​
    15·2 answers
  • WILL MARK BRAINLIEST QUIZ ENDS AT 9:40am TODAY!!!
    6·1 answer
  • Adham is interested to buy a pair of shoes, at Lazzado.com as follows:
    14·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!