Question

Noncash assets are expected to produce cash over time but the amount of cash they eventually produce could be higher or lower than the values at which the assets are carried on the books.

A. True
B. False

Answer 1

Correct answer is TRUE

Step-by-step explanation:

Non-cash assets are expected to produce cash over time but the amount of cash they eventually produce could be higher or lower than the values at which the assets are carried on the books. Some factors that affects the value of non-cash assets are the general economic forces such as inflation or deflation, amortization or impairement itself of the assets. It maybe realized at favorable side (gain) or unfavorable (loss) side.