Certified Energy Manager questions with correct answers

Depreciation CORRECT ANSWER Assets that decrease in value over time. US Federal Income Tax law permits reasonable deductions for depreciation. This involves borrowing and utilizing money which is to be repaid at a later point in time. CORRECT ANSWER Debit Financing What is the benefit to debt financing under current U.S tax law (as of December 2008)? CORRECT ANSWER Interests payments made by corporations on debit capital are tax deductible. Under this type of financing the lender acquires an ownership position within the borrower's organization. CORRECT ANSWER Equity These are the accumulation of annual earnings surpluses that a company retains within the company's coffers rather than pays out to stockholders as dividends. CORRECT ANSWER Retained Earnings How is taxable income calculated? CORRECT ANSWER Gross Income - Allowable Deduction What method is presently used for calculating depreciation? CORRECT ANSWER MACRS - Modified Accelerated Cost Recovery System What units does a degree day have? CORRECT ANSWER F - Day/Yr