Equipment Acquisition & Disposal Flashcards

When evaluating a lease vs. purchase decision for exhibition AV equipment, which financial metric best accounts for the time value of money?

Answer: Net present value (NPV)

NPV discounts future cash flows to present value, making it the most accurate tool for comparing lease vs. purchase costs over time.

A venue needs to dispose of aging rigging equipment. Which action should be taken FIRST before disposal?

Answer: Conduct a safety inspection and document the equipment's condition

Documenting condition through a safety inspection protects the organization from liability and ensures proper disposal pathways are selected.

Which depreciation method results in the highest expense in the early years of an asset's life?

Answer: Double declining balance depreciation

Double declining balance applies twice the straight-line rate to the book value each year, front-loading depreciation expenses.

An exhibition manager is acquiring custom-branded booth furniture. Which procurement approach offers the most price leverage?

Answer: Competitive bidding with at least three vendors

Soliciting bids from multiple vendors creates competition that typically drives down pricing and improves terms.

Which document establishes the specific technical requirements equipment must meet before a purchase order is issued?

Answer: Equipment specification sheet

An equipment specification sheet details exact performance, dimensional, and compliance standards the purchased equipment must satisfy.

When donating used exhibition equipment to a non-profit, what document is required for the organization to claim a tax deduction?

Answer: Qualified appraisal for items over $5,000

IRS rules require a qualified appraisal from a certified appraiser for non-cash charitable donations exceeding $5,000.

A trade show organizer is acquiring portable flooring for 50 events per year. Which total cost of ownership (TCO) factor is most often overlooked?

Answer: Shipping and storage costs over the asset's lifespan

Recurring logistics costs—shipping, warehousing, and handling—often exceed the initial purchase price over a high-use flooring asset's life.