Question 1

If an asset is being discarded then there is no need to update the depreciation prior to disposal.

Accepted Answer

A) True 
 B)False

Question 2

TLR Inc.has installed a piece of machinery for a total of $76,000.In its third month of operation,repairs of $1,300 had to be made on the machine.This $1,300 would be:

Accepted Answer

A) added to the cost of the machinery. 
B) treated as a repairs and maintenance expense. 
C) capitalized in an asset account. 
D) deducted from cost of the machinery. 
A) added to the cost of the machinery. 
B) treated as a repairs and maintenance expense. 
C) capitalized in an asset account. 
D) deducted from cost of the machinery.

Question 3

When a company pays a single price for a group of assets,the purchase is referred to as a basket purchase.

Accepted Answer

A) True 
 B)False

Question 4

A company purchased a computer system on March 1.Its cost was $35,000,and it had an estimated salvage value of $5,000.It was expected to have a useful life of four years.To the nearest dollar,the depreciation for year 1 using straight-line depreciation will be:

Accepted Answer

A) $8,750. 
B) $7,500. 
C) $6,250. 
D) $5,625. 
A) $8,750. 
B) $7,500. 
C) $6,250. 
D) $5,625.

Question 5

Which of the following would be considered part of the cost of machinery and equipment?

Accepted Answer

A) Sales taxes 
B) Repairs after start-up 
C) Maintenance 
D) Insurance after purchase 
A) Sales taxes 
B) Repairs after start-up 
C) Maintenance 
D) Insurance after purchase

Question 6

Accumulated depletion is a(n):

Accepted Answer

A) contra-asset account. 
B) contra-liability account. 
C) expense account. 
D) cash account. 
A) contra-asset account. 
B) contra-liability account. 
C) expense account. 
D) cash account.

Question 7

Which of the following accounts would be credited in a journal entry for an asset exchange?

Accepted Answer

A) Accumulated Depreciation-Old Truck 
B) Truck (Old) 
C) Loss on Exchange of Assets 
D) Truck (New) 
A) Accumulated Depreciation-Old Truck 
B) Truck (Old) 
C) Loss on Exchange of Assets 
D) Truck (New)

Question 8

For which kind of marketable securities are any unrealized gains and losses shown on the income
Statement?

Accepted Answer

A) Trading securities 
B) Available-for sale securities 
C) Held-to-maturity securities 
D) Trading and held-to-maturity securities 
A) Trading securities 
B) Available-for sale securities 
C) Held-to-maturity securities 
D) Trading and held-to-maturity securities

Question 9

It is determined that a computer's depreciation expense for the year is $3,500.The journal entry to record this will be:

Accepted Answer

A) debit Depreciation Expense - computer $3,500;credit Cash $3,500. 
B) debit Accumulated Depreciation - computer $3,500;credit Cash $3,500. 
C) debit Depreciation Expense - computer $3,500;credit Accumulated Depreciation,$3,500. 
D) debit Cash $3,500;credit Depreciation Expense - computer $3,500. 
A) debit Depreciation Expense - computer $3,500;credit Cash $3,500. 
B) debit Accumulated Depreciation - computer $3,500;credit Cash $3,500. 
C) debit Depreciation Expense - computer $3,500;credit Accumulated Depreciation,$3,500. 
D) debit Cash $3,500;credit Depreciation Expense - computer $3,500.

Question 10

The slogan "Can you hear me now?" for Verizon is a protected slogan called a:

Accepted Answer

A) patent. 
B) copyright. 
C) trademark. 
D) brand name. 
A) patent. 
B) copyright. 
C) trademark. 
D) brand name.

Question 11

Which of the following marketable securities are reported at market value on the Balance Sheet date?

Accepted Answer

A) Held-to-maturities securities 
B) Available-for-sale securities 
C) Trading securities 
D) Available-for-sale and trading securities 
A) Held-to-maturities securities 
B) Available-for-sale securities 
C) Trading securities 
D) Available-for-sale and trading securities

Question 12

A company purchased a truck on August 1,2013.Using straight-line depreciation,the company would report four (4)months depreciation on December 31,2013.

Accepted Answer

A) True 
 B)False

Question 13

Island Industries inadvertently recorded a $5,000 betterment as an ordinary repair.Which of the following will occur as a result of this mistake?

Accepted Answer

A) Assets will be overstated by $5,000. 
B) Assets will be understated by $5,000. 
C) Net income will be overstated by $5,000. 
D) Retained Earnings will be overstated by $5,000. 
A) Assets will be overstated by $5,000. 
B) Assets will be understated by $5,000. 
C) Net income will be overstated by $5,000. 
D) Retained Earnings will be overstated by $5,000.

Question 14

A company purchased furniture on January 1.Its cost was $15,600,and it had a residual value of $1,600.Its useful life is determined to be 3 years.Using double-declining balance depreciation,the depreciation for year 1 to the nearest dollar will be:

Accepted Answer

A) $10,400. 
B) $9,333. 
C) $5,200. 
D) $4,667. 
A) $10,400. 
B) $9,333. 
C) $5,200. 
D) $4,667.

Question 15

Which would NOT be included in the recorded price of a piece of machinery?

Accepted Answer

A) Installation costs 
B) Maintenance costs 
C) Delivery charges 
D) Sales taxes 
A) Installation costs 
B) Maintenance costs 
C) Delivery charges 
D) Sales taxes

Question 16

Acme paid $100,000 for a machine with a $5,000 salvage value and an estimated life of 190,000 hours.
Acme reports on a calendar year basis and used the machine for 1,700 hours during the first year it owned the asset.Which of the following statements accurately compare the first year depreciation expense if the asset had been purchased on January 1 of the current year versus a March 1 acquisition date.

Accepted Answer

A) Depreciation Expense if acquired January 1 is $850 and if acquired March 1 is $708. 
B) Depreciation Expense if acquired January 1 is $850 and if acquired March 1 is $637. 
C) In both cases,the Depreciation Expense is $850. 
D) Depreciation Expense if acquired January 1 is $895 and if acquired March 1 is $746. 
A) Depreciation Expense if acquired January 1 is $850 and if acquired March 1 is $708. 
B) Depreciation Expense if acquired January 1 is $850 and if acquired March 1 is $637. 
C) In both cases,the Depreciation Expense is $850. 
D) Depreciation Expense if acquired January 1 is $895 and if acquired March 1 is $746.

Question 17

If an exchange of assets lacks commercial substance,then no gain or loss on the exchange is recognized.

Accepted Answer

A) True 
 B)False

Question 18

Intangibles,such as patents and copyrights,are generally listed after property,plant,and equipment and after natural resources on a company's long-term assets portion of the Balance Sheet.

Accepted Answer

A) True 
 B)False

Question 19

A company purchased a van at a cost of $42,000 and expects its salvage value to be $6,000 after 120,000 miles of service.Using the units-of-production method,what is the first year's depreciation if the van is driven 24,000 miles?

Accepted Answer

A) $1,200 
B) $4,200 
C) $7,200 
D) $12,000 
A) $1,200 
B) $4,200 
C) $7,200 
D) $12,000

Question 20

Long-term investments (assets)by a corporation are:

Accepted Answer

A) amortized. 
B) depleted. 
C) depreciated. 
D) not treated as fixed assets. 
A) amortized. 
B) depleted. 
C) depreciated. 
D) not treated as fixed assets.

If an asset is being discarded then there is no need to update the depreciation prior to disposal.

TLR Inc.has installed a piece of machinery for a total of $76,000.In its third month of operation,repairs of $1,300 had to be made on the machine.This $1,300 would be:

When a company pays a single price for a group of assets,the purchase is referred to as a basket purchase.

A company purchased a computer system on March 1.Its cost was $35,000,and it had an estimated salvage value of $5,000.It was expected to have a useful life of four years.To the nearest dollar,the depreciation for year 1 using straight-line depreciation will be:

Which of the following would be considered part of the cost of machinery and equipment?

Accumulated depletion is a(n):

Which of the following accounts would be credited in a journal entry for an asset exchange?

For which kind of marketable securities are any unrealized gains and losses shown on the income Statement?

It is determined that a computer's depreciation expense for the year is $3,500.The journal entry to record this will be:

The slogan "Can you hear me now?" for Verizon is a protected slogan called a:

Which of the following marketable securities are reported at market value on the Balance Sheet date?

A company purchased a truck on August 1,2013.Using straight-line depreciation,the company would report four (4)months depreciation on December 31,2013.

Island Industries inadvertently recorded a $5,000 betterment as an ordinary repair.Which of the following will occur as a result of this mistake?

A company purchased furniture on January 1.Its cost was $15,600,and it had a residual value of $1,600.Its useful life is determined to be 3 years.Using double-declining balance depreciation,the depreciation for year 1 to the nearest dollar will be:

Which would NOT be included in the recorded price of a piece of machinery?

If an exchange of assets lacks commercial substance,then no gain or loss on the exchange is recognized.

Intangibles,such as patents and copyrights,are generally listed after property,plant,and equipment and after natural resources on a company's long-term assets portion of the Balance Sheet.

A company purchased a van at a cost of $42,000 and expects its salvage value to be $6,000 after 120,000 miles of service.Using the units-of-production method,what is the first year's depreciation if the van is driven 24,000 miles?

Long-term investments (assets)by a corporation are:

Business, Accounting, and You

Analyzing and Recording Business Transactions

Adjusting and Closing Entries

Accounting for a Merchandising Business

Inventory

The Challenges of Accounting: Standards, internal Control, audits, fraud, and Ethics

Cash and Receivables

Current Liabilities and Long-Term Debt

Corporations: Paid-In Capital and Retained Earnings

The Statement of Cash Flows

Financial Statement Analysis

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Exam 8: Long-Term and Other Assets

If an asset is being discarded then there is no need to update the depreciation prior to disposal.

TLR Inc.has installed a piece of machinery for a total of $76,000.In its third month of operation,repairs of $1,300 had to be made on the machine.This $1,300 would be:

When a company pays a single price for a group of assets,the purchase is referred to as a basket purchase.

A company purchased a computer system on March 1.Its cost was $35,000,and it had an estimated salvage value of $5,000.It was expected to have a useful life of four years.To the nearest dollar,the depreciation for year 1 using straight-line depreciation will be:

Which of the following would be considered part of the cost of machinery and equipment?

Accumulated depletion is a(n):

Which of the following accounts would be credited in a journal entry for an asset exchange?

For which kind of marketable securities are any unrealized gains and losses shown on the income Statement?

It is determined that a computer's depreciation expense for the year is $3,500.The journal entry to record this will be:

The slogan "Can you hear me now?" for Verizon is a protected slogan called a:

Which of the following marketable securities are reported at market value on the Balance Sheet date?

A company purchased a truck on August 1,2013.Using straight-line depreciation,the company would report four (4)months depreciation on December 31,2013.

Island Industries inadvertently recorded a $5,000 betterment as an ordinary repair.Which of the following will occur as a result of this mistake?

A company purchased furniture on January 1.Its cost was $15,600,and it had a residual value of $1,600.Its useful life is determined to be 3 years.Using double-declining balance depreciation,the depreciation for year 1 to the nearest dollar will be:

Which would NOT be included in the recorded price of a piece of machinery?

If an exchange of assets lacks commercial substance,then no gain or loss on the exchange is recognized.

Intangibles,such as patents and copyrights,are generally listed after property,plant,and equipment and after natural resources on a company's long-term assets portion of the Balance Sheet.

A company purchased a van at a cost of $42,000 and expects its salvage value to be $6,000 after 120,000 miles of service.Using the units-of-production method,what is the first year's depreciation if the van is driven 24,000 miles?

Long-term investments (assets)by a corporation are:

Business, Accounting, and You

Analyzing and Recording Business Transactions

Adjusting and Closing Entries

Accounting for a Merchandising Business

Inventory

The Challenges of Accounting: Standards, internal Control, audits, fraud, and Ethics

Cash and Receivables

Current Liabilities and Long-Term Debt

Corporations: Paid-In Capital and Retained Earnings

The Statement of Cash Flows

Financial Statement Analysis

Filters