answer 1-10

Question 1: True or false. 1. The asset impairment loss is equal to the excess of net book value of an asset over i expected future cash flows assets Tangible long-lived productive assets differ from intangible long-lived productive in that tangible assets have physical substance whereas intangible assets have o substance. 2. 3. The equipment cost initially reported on the balance sheet ineludes related installation costs . Ordinary repairs and maintenance costs are incurred to maintain a long-lived asset and should be capitalized. 5. The net book value of a depreciable asset equals its acquisition cost minus the depeciation expense for the current year Return on equity (ROE) Is a function of three ratios: net profit margin, retum on assets. and financial leverage. 6. 7. Return on assets (ROA) should be always smaller than return on equity (ROE). 8. The inventory turmover ratio is signiticantly affected by the choice of inventory accounting method. 9. The tixed asset turnover ratio increases when net income increases Current ratio is used to measure the ability of a company to pay off its long-term debt. 10