The key characteristics of an asset as defined in the Framework includE.
A)There must be future economic benefits.
B)The reporting entity must control the future economic benefits.
C)The asset results from past transactions.
D)All of the given answers.
E)There must be future economic benefits and the reporting entity must control the future economic benefit.

Question

Quizplus · Accepted Answer

The key characteristics of an asset as defined in the Framework include:
1. There must be future economic benefits.
2. The reporting entity must control the future economic benefits.
3. The asset results from past transactions or events.
Therefore, the correct answer is:
4. All of the given answers.
Each of these characteristics is essential for a resource to be considered an asset in the context of financial reporting. Future economic benefits may include potential cash flows, goods, services, or other benefits that will be received or utilized by the entity. Control over these benefits implies that the entity has the ability to use or direct the use of the resource to generate economic benefits, and that it can restrict others from accessing those benefits. Lastly, the asset must have arisen from past transactions or events, which means it is a result of previous business activities that have already occurred.

The Key Characteristics of an Asset as Defined in the Framework