amortization

just tell me if u r sick of me … Assume the managers want to maximize bonuses, which are based on current net income. Managers should prefer: A. Successful efforts rather than full costing of oil & gas drilling. B. Expensing research & development costs. C. Amortizing goodwill over a very short period (rather than 40 years). D. Using straight-line rather than accelerated depreciation for financial statement purposes.

hmmmm D?

d

B?

D

D for sure.

D would be for Yr1, but then what… NI would decrease the following years… Would they want to max bonuses only yr1 or many years?

Yeap that’s D

D, B and C would give lower income, i am sure you gusy realized that. A is i dont know.

pepp Wrote: ------------------------------------------------------- > D, > > B and C would give lower income, i am sure you > gusy realized that. A is i dont know. ‘A’ says you will be expensing unsuccessful exploration efforts instead of capitalizing them (lower NI)