Intercompany profits in inventory and land are realized through the eventual sale to outsiders, whereas depreciable assets are considered realized though consumption. What is realization through consumption? Multiple Choice • By increasing the asset, we realize the gain because the asset is worth more than it was originally. • By decreasing depreciation expense, we increase income and thus realize the unrealized gain. • By decreasing depreciation expense, we increase cost of goods sold. • By increasing depreciation expense, we decrease the cost of the asset to its original cost.

Intercompany profits in inventory and land are realized through the eventual sale to outsiders, whereas depreciable assets are considered realized though consumption. What is realization through consumption? Multiple Choice • By increasing the asset, we realize the gain because the asset is worth more than it was originally. • By decreasing depreciation expense, we increase income and thus realize the unrealized gain. • By decreasing depreciation expense, we increase cost of goods sold. • By increasing depreciation expense, we decrease the cost of the asset to its original cost.

Personal Finance

13th Edition

ISBN:9781337669214

Author:GARMAN

Publisher:GARMAN

Chapter16: Real Estate And High-risk Investments

Section16.5: Investing In Collectibles, Precious Metals,

Problem 1CC

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