Exam 9: Reporting and Analyzing Long-Lived Assets

During 2022, Ronald Corporation reported net sales of $2,000,000, net income of $900,000, and depreciation expense of $100,000.Ronald also reported beginning total assets of $1,000,000, ending total assets of $1,500,000, plant assets of $800,000, and accumulated depreciation of $500,000.Ronald's asset turnover is

Rodgers Company purchased equipment and these costs were incurred: Rodgers will record the acquisition cost of the equipment as

Bates Company purchased equipment on January 1, 2021 at a total invoice cost of $1,200,000.The equipment has an estimated salvage value of $30,000 and an estimated useful life of 5 years.What is the amount of accumulated depreciation at December 31, 2022 if the straight-line method of depreciation is used?

Management should select the depreciation method that

Trademarks are generally shown on the balance sheet under

All plant assets (fixed assets) must be depreciated for accounting purposes.

Runge Company purchased machinery on January 1 at a list price of $300,000, with credit terms 2/10, n/30.Payment was made within the discount period.Runge paid $15,000 sales tax on the machinery and paid installation charges of $5,300.Prior to installation, Runge paid $12,000 to pour a concrete slab on which to place the machinery.What is the total cost of the new machinery?

Which one of the following items is not considered a part of the cost of a truck purchased for business use?

Equipment costing $280,000 was destroyed when it caught on fire.At the date of the fire, the accumulated depreciation on the equipment was $112,000.An insurance check for $320,000 was received based on the replacement cost of the equipment.The entry to record the insurance proceeds and the disposition of the equipment will include a

Machinery was purchased for $340,000.Freight charges amounted to $14,000 and there was a cost of $40,000 for building a foundation and installing the machinery.It is estimated that the machinery will have a $60,000 salvage value at the end of its 5-year useful life.Depreciation expense each year using the straight-line method will be

Morton's Courier Service recorded a loss of $7,500 when it sold a van that originally cost $70,000 for $12,500.Accumulated depreciation on the van must have been

The balance in the Accumulated Depreciation account represents the

A machine that was purchased on January 1 for $60,000 has an estimated salvage value of $12,000.If the machine's depreciation rate is 20%, its annual depreciation is

The calculation of depreciation using the declining-balance method

The following information is provided for Nguyen Company and Northwest Corporation. What is Nguyen's asset turnover for 2022?

On July 1, 2022, Dillman Kennels sells equipment for $110,000.The equipment originally cost $300,000, had an estimated 5-year life and an expected salvage value of $50,000.The Accumulated Depreciation account had a balance of $175,000 on January 1, 2022 using the straight-line method.The gain or loss on disposal is

The declining-balance method of depreciation is called an accelerated depreciation method because it depreciates an asset in a shorter period of time than the asset's useful life.

The following information is provided for Nguyen Company and Northwest Corporation. If Nguyen and Northwest are in the same industry and the industry average for asset turnover is equal to 1.20 times, which of the following statements is true?

Foyle Company purchased a new van for floral deliveries on January 1, 2022.The van cost $56,000 with an estimated life of 5 years and $14,000 salvage value at the end of its useful life.The double-declining-balance method of depreciation will be used.What is the depreciation expense for 2022?

Equipment that cost $90,000 and on which $50,000 of accumulated depreciation has been recorded was disposed of for $45,000 cash.The entry to record this event would include a