Multiple Choice
Which of the following types of accounting focuses on providing information to internal users, such as managers, for decision-making purposes?
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1. Introduction to Accounting
Types of Accounting
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An asset that has no physical substance is called a(n) ______ asset.
A
intangible
B
tangible
C
fixed
D
current
Verified step by step guidance1
Understand the definition of the term 'asset' in Financial Accounting. Assets are resources owned by a company that have economic value and are expected to provide future benefits.
Learn about the classification of assets. Assets can be categorized into tangible assets (physical substance, e.g., machinery, buildings) and intangible assets (no physical substance, e.g., patents, trademarks).
Review the characteristics of intangible assets. These assets are identifiable, non-physical, and often provide long-term benefits to the company, such as intellectual property or goodwill.
Compare the given options: 'intangible,' 'tangible,' 'fixed,' and 'current.' Determine which term best fits the description of an asset with no physical substance.
Conclude that the correct answer is 'intangible,' as it aligns with the definition of an asset that lacks physical substance.
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