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Forming a corporation is more costly than starting a sole proprietorship. The cost may include, for example, attorneys fees, inc
Forming a corporation is more costly than starting a sole proprietorship. The cost may include, for example, attorneys fees, inc
admin
2013-12-25
38
问题
Forming a corporation is more costly than starting a sole proprietorship. The cost may include, for example, attorneys fees, incorporation fees paid to the state, and other outlays necessary to bring the corporation into existence. These costs are charged to an asset account entitled organization costs. In the balance sheet, organization costs appear under the other assets caption. Conceptually, organization costs are an intangible asset that will benefit the corporation over its entire life. But as a practical matter, most corporations amortize this asset to expense over a period of only 5 years, as allowed under income tax regulations. Because the amortization of organization costs usually is immaterial in dollar amount, this convenient treatment is justified by the accounting principle of materiality.
Organization costs must be amortized into expenses within 5 years.
选项
A、Right
B、Wrong
C、Doesn’t say
答案
B
解析
从倒数第二句But as a practical matter,most corporations amortize this asset to expense over a period of only 5 years…可以直接看出。
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本试题收录于:
FECT综合(现代金融业务)题库金融英语(FECT)分类
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FECT综合(现代金融业务)
金融英语(FECT)
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