Multiple Choice
Because every transaction has a buyer and a seller, which accounting principle ensures that each transaction is recorded in at least two accounts, maintaining the accounting equation?
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1. Introduction to Accounting
Types of Accounting
Struggling with Financial Accounting?
Join thousands of students who trust us to help them ace their exams!Watch the first videoMultiple Choice
Which of the following best defines plant assets?
A
Intangible assets such as patents and copyrights.
B
Short-term investments held for trading purposes.
C
Long-term tangible assets used in the operations of a business and not intended for sale.
D
Inventory items held for resale to customers.
Verified step by step guidance1
Understand the term 'plant assets' by breaking it down: 'plant' refers to physical, tangible assets, and 'assets' are resources owned by a business.
Recognize that plant assets are long-term assets, meaning they are expected to provide value to the business over multiple accounting periods.
Identify that plant assets are tangible, meaning they have a physical form (e.g., buildings, machinery, equipment). This distinguishes them from intangible assets like patents and copyrights.
Clarify that plant assets are used in the operations of a business, meaning they are essential for producing goods or services, rather than being held for resale or investment purposes.
Exclude other options such as inventory (short-term assets held for resale) and intangible assets (non-physical assets), as they do not fit the definition of plant assets.
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