Question: There is a range of items on the balance sheet that lack tangibility'. There are items such as: a. Short- or long-term accounts receivable b.

There is a range of items on the balance sheet that lack tangibility'. There are items such as:
a. Short- or long-term accounts receivable
b. Prepaid expenses for rent or insurance
c. Deferred development expenses front R&D activities
d. Internally' developed patents/copyrights, acquired patents/copyrights
e. Franchise rights held by a franchisee (e.g., an operator of a McDonald’s restaurant)
f. Goodwill
Required:
Explain why each of these items can be treated as assets.

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a Short or longterm accounts receivable are treated as assets as they represent legally enforceable cash inflows These monetary cash inflows are clear... View full answer

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