Companies that engage in fraud will often capitalize an asset rather than an expense account.

Name: Companies that engage in fraud will often capitalize an asset rather than an expense account.
Brand: Quizplus
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Question

Quizplus · Accepted Answer

Capitalizing an asset allows the cost to be spread out over multiple periods, making it easier to conceal fraudulent activity. Expensing the cost would have an immediate impact on the company's financial statements, making it more difficult to hide irregularities.

Companies That Engage in Fraud Will Often Capitalize an Asset