Question 1

___________________ are additional costs of plant assets that do not materially increase the asset's life or productive capabilities.

Accepted Answer

Revenue ex

Question 2

A company purchased equipment valued at $200,000 on January 1.The equipment has an estimated useful life of six years or 5 million units.The equipment is estimated to have a salvage value of $13,400.
-Assuming the double declining balance method of depreciation,what is the book value at the end of the second year?

Accepted Answer

A)  $166,667.00 
B) $88,897.78 
C) $96,416.25 
D) $168,900.00 
E) $137,800.00 
A)  $166,667.00 
B) $88,897.78 
C) $96,416.25 
D) $168,900.00 
E) $137,800.00

Question 3

Match between columns
                        Premises: Change in accounting estimate
Depletion
Betterment
Units-of production method
Accelerated depreciation
Revenue expenditure
ntangible assets
Ordinary repairs
Asset turnover
Goodwill

Accepted Answer

The Answer of An expenditure reported on the current income is...

Question 4

A company bought a new display case for $42,000 and was given a trade-in of $2,000 on an old display case,so the company paid $40,000 cash with the trade-in.The old case had an original cost of $37,000 and accumulated depreciation of $34,000.The company should record the value of new display case at:

Accepted Answer

A) $2,000 
B) $3,000 
C) $40,000 
D) $42,000 
E) $43,000 
A) $2,000 
B) $3,000 
C) $40,000 
D) $42,000 
E) $43,000

Question 5

Another name for a capital expenditure is:

Accepted Answer

A) Revenue expenditure 
B) Asset expenditure 
C) Long-term expenditure 
D) Contributed capital expenditure 
E) Balance sheet expenditure 
A) Revenue expenditure 
B) Asset expenditure 
C) Long-term expenditure 
D) Contributed capital expenditure 
E) Balance sheet expenditure

Question 6

A company purchased a POS cash register on January 1 for $5,400.This register has a useful life of 10 years and a salvage value of $400.What would be the depreciation expense for the second-year of its useful life using the double-declining-balance method?

Accepted Answer

A) $500 
B) $800 
C) $864 
D) $1,000 
E) $1,080 
A) $500 
B) $800 
C) $864 
D) $1,000 
E) $1,080

Question 7

When an asset is purchased (or disposed of) at any time other than the beginning or the end of an accounting period,depreciation is recorded for part of a year so that the year of purchase or the year of disposal is charged with its share of the asset's depreciation.

Accepted Answer

A) True 
 B)False

Question 8

A company purchased equipment valued at $200,000 on January 1.The equipment has an estimated useful life of six years or 5 million units.The equipment is estimated to have a salvage value of $13,400.
-Assuming the double declining balance method of depreciation,what is the depreciation for the second year?

Accepted Answer

A)  $41,445.91 
B) $62,137.80 
C) $31,100.00 
D) $55,980.00 
E) $44,442.22 
A)  $41,445.91 
B) $62,137.80 
C) $31,100.00 
D) $55,980.00 
E) $44,442.22

Question 9

Revenue expenditures are additional costs of plant assets that materially increase the assets' life or productive capabilities.

Accepted Answer

A) True 
 B)False

Question 10

A company purchased equipment valued at $825,000 on January 1.The equipment has an estimated useful life of seven years or 6 million units.The equipment is estimated to have a salvage value of $35,000.Assuming the straight-line method of depreciation,what is depreciation for the second year?

Accepted Answer

The answer of A company purchased equipment valued at $825,000...

Question 11

A company purchased property for a building site.The costs associated with the property were:   What portion of these costs should be allocated to the cost of the land and what portion should be allocated to the cost of the new building?

Accepted Answer

A) $175,800 to Land; $18,800 to Building 
B) $190,000 to Land; $3,800 to Building 
C) $190,800 to Land; $1,000 to Building 
D) $192,800 to Land; $0 to Building 
E) $193,800 to Land; $0 to Building 
A) $175,800 to Land; $18,800 to Building 
B) $190,000 to Land; $3,800 to Building 
C) $190,800 to Land; $1,000 to Building 
D) $192,800 to Land; $0 to Building 
E) $193,800 to Land; $0 to Building

Question 12

Treating capital expenditures of a small dollar amount as revenue expenditures is likely to mislead the users of financial statements.

Accepted Answer

A) True 
 B)False

Question 13

A company exchanged an old truck for a newer model.The old truck account had a cost of $76,000 and accumulated depreciation of $65,000 as of the exchange date.The new truck had a cash price of $84,000,but the company was given a $15,000 trade-in allowance and the balance of $69,000 was paid in cash.Prepare the journal entry to record the exchange.

Accepted Answer

@#IMG-DLM&_TB6947_00_TB6947_00

Question 14

A depreciation method in which a plant asset's depreciation expense for a period is determined by applying a constant depreciation rate each period to the asset's beginning book value is called:

Accepted Answer

A) Book value depreciation. 
B) Declining-balance depreciation. 
C) Straight-line depreciation. 
D) Units-of-production depreciation. 
E) Modified accelerated cost recovery system (MACRS) depreciation. 
A) Book value depreciation. 
B) Declining-balance depreciation. 
C) Straight-line depreciation. 
D) Units-of-production depreciation. 
E) Modified accelerated cost recovery system (MACRS) depreciation.

Question 15

Land improvements are:

Accepted Answer

A) Assets that increase the usefulness of land and,like land,are not depreciated. 
B) Assets that increase the usefulness of land but that have a limited useful life and are subject to depreciation. 
C) Included in the cost of the land account. 
D) Expensed in the period incurred. 
E) Also called basket purchases. 
A) Assets that increase the usefulness of land and,like land,are not depreciated. 
B) Assets that increase the usefulness of land but that have a limited useful life and are subject to depreciation. 
C) Included in the cost of the land account. 
D) Expensed in the period incurred. 
E) Also called basket purchases.

Question 16

On December 31,2013,Stable Company sold a piece of equipment that was purchased on January 1,2009.The equipment originally cost $820,000 and has an estimated useful life of eight years.Stable uses the double-declining-balance method of depreciation.What is the gain/loss on the sale of equipment that Stable will recognize if the equipment was sold for $230,000?

Accepted Answer

A)  $35,409.50 gain 
B) $25,000.00 loss 
C) $25,000.00 gain 
D) $35,408.00 loss 
E) $0; no gain or loss 
A)  $35,409.50 gain 
B) $25,000.00 loss 
C) $25,000.00 gain 
D) $35,408.00 loss 
E) $0; no gain or loss

Question 17

A company purchased mining property containing 7,350,000 tons of ore for $1,837,500.In 2012 it mined and sold 857,000 tons of ore and in 2013 it mined and sold 943,000 tons of ore.Calculate the depletion expense for 2012 and 2013.What was the book value of the property at the end of 2013?

Accepted Answer

a. $1,837,500/7,350,000 tons =

Question 18

A company had net sales of $541,500 in 2013 and $475,300 in 2014.Its average assets were $410,000 for 2013 and $400,000 for 2014.(1) Calculate the total asset turnover for each year.(2) Interpret and comment on the company's efficiency in the use of its assets.

Accepted Answer

2013: $541,500/$410,000 = 1.32
2014: $47

Question 19

A company purchased equipment for $50,000 on January 1,2012.The equipment was sold for $10,000 on December 31,2015.Accumulated Depreciation in the amount of $40,000 had been recorded through that date.How would the company record this transaction?

Accepted Answer

A) Debit Cash for $10,000,debit Accumulated Depreciation-Equipment for $40,000,and credit Equipment for $50,000. 
B) Debit Loss on Disposal of Equipment for $10,000 and credit Equipment for $10,000. 
C) Debit Loss on Disposal of Equipment for $40,000 and credit Accumulated Depreciation-Equipment for $40,000. 
D) Debit Equipment for $50,000,credit Accumulated Depreciation-Equipment for $40,000,and credit Cash for $10,000. 
E) Debit Cash for $50,000,credit Accumulated Depreciation-Equipment for $40,000,and credit Equipment for $10,000. 
A) Debit Cash for $10,000,debit Accumulated Depreciation-Equipment for $40,000,and credit Equipment for $50,000. 
B) Debit Loss on Disposal of Equipment for $10,000 and credit Equipment for $10,000. 
C) Debit Loss on Disposal of Equipment for $40,000 and credit Accumulated Depreciation-Equipment for $40,000. 
D) Debit Equipment for $50,000,credit Accumulated Depreciation-Equipment for $40,000,and credit Cash for $10,000. 
E) Debit Cash for $50,000,credit Accumulated Depreciation-Equipment for $40,000,and credit Equipment for $10,000.

Question 20

Ace Company purchased a machine valued at $320,000 on August 1.The equipment has an estimated useful life of five years or 2.5 million units.The equipment is estimated to have a salvage value of $8,200.Assuming the double-declining-balance method of depreciation,what is the amount of depreciation expense that needs to be recorded at the end of the second year?

Accepted Answer

A)  $128,000 
B) $62,360 
C) $90,880 
D) $88,750 
E) $106,667 
A)  $128,000 
B) $62,360 
C) $90,880 
D) $88,750 
E) $106,667

___________________ are additional costs of plant assets that do not materially increase the asset's life or productive capabilities.

Another name for a capital expenditure is:

A company purchased a POS cash register on January 1 for $5,400.This register has a useful life of 10 years and a salvage value of $400.What would be the depreciation expense for the second-year of its useful life using the double-declining-balance method?

When an asset is purchased (or disposed of) at any time other than the beginning or the end of an accounting period,depreciation is recorded for part of a year so that the year of purchase or the year of disposal is charged with its share of the asset's depreciation.

Revenue expenditures are additional costs of plant assets that materially increase the assets' life or productive capabilities.

A company purchased equipment valued at $825,000 on January 1.The equipment has an estimated useful life of seven years or 6 million units.The equipment is estimated to have a salvage value of $35,000.Assuming the straight-line method of depreciation,what is depreciation for the second year?

A company purchased property for a building site.The costs associated with the property were: What portion of these costs should be allocated to the cost of the land and what portion should be allocated to the cost of the new building?

Treating capital expenditures of a small dollar amount as revenue expenditures is likely to mislead the users of financial statements.

A depreciation method in which a plant asset's depreciation expense for a period is determined by applying a constant depreciation rate each period to the asset's beginning book value is called:

Land improvements are:

A company purchased mining property containing 7,350,000 tons of ore for $1,837,500.In 2012 it mined and sold 857,000 tons of ore and in 2013 it mined and sold 943,000 tons of ore.Calculate the depletion expense for 2012 and 2013.What was the book value of the property at the end of 2013?

A company had net sales of $541,500 in 2013 and $475,300 in 2014.Its average assets were $410,000 for 2013 and $400,000 for 2014.(1) Calculate the total asset turnover for each year.(2) Interpret and comment on the company's efficiency in the use of its assets.

A company purchased equipment for $50,000 on January 1,2012.The equipment was sold for $10,000 on December 31,2015.Accumulated Depreciation in the amount of $40,000 had been recorded through that date.How would the company record this transaction?

Introducing Financial Accounting

Accounting System and Financial Statements

Adjusting Accounts for Financial Statements

Reporting and Analyzing Merchandising Operations

Reporting and Analyzing Inventories

Reporting and Analyzing Cash and Internal Controls

Reporting and Analyzing Receivables

Reporting and Analyzing Current Liabilities

Reporting and Analyzing Long-Term Liabilities

Reporting and Analyzing Equity

Reporting and Analyzing Cash Flows

Analyzing and Interpreting Financial Statements

Applying Present and Future Values

Investments and International Operations

Accounting for Partnerships

Accounting With Special Journals

Filters

Exam 8: Reporting and Analyzing Long-Term Assets

___________________ are additional costs of plant assets that do not materially increase the asset's life or productive capabilities.

Another name for a capital expenditure is:

A company purchased a POS cash register on January 1 for $5,400.This register has a useful life of 10 years and a salvage value of $400.What would be the depreciation expense for the second-year of its useful life using the double-declining-balance method?

When an asset is purchased (or disposed of) at any time other than the beginning or the end of an accounting period,depreciation is recorded for part of a year so that the year of purchase or the year of disposal is charged with its share of the asset's depreciation.

Revenue expenditures are additional costs of plant assets that materially increase the assets' life or productive capabilities.

A company purchased equipment valued at $825,000 on January 1.The equipment has an estimated useful life of seven years or 6 million units.The equipment is estimated to have a salvage value of $35,000.Assuming the straight-line method of depreciation,what is depreciation for the second year?

A company purchased property for a building site.The costs associated with the property were: What portion of these costs should be allocated to the cost of the land and what portion should be allocated to the cost of the new building?

Treating capital expenditures of a small dollar amount as revenue expenditures is likely to mislead the users of financial statements.

A depreciation method in which a plant asset's depreciation expense for a period is determined by applying a constant depreciation rate each period to the asset's beginning book value is called:

Land improvements are:

A company purchased mining property containing 7,350,000 tons of ore for $1,837,500.In 2012 it mined and sold 857,000 tons of ore and in 2013 it mined and sold 943,000 tons of ore.Calculate the depletion expense for 2012 and 2013.What was the book value of the property at the end of 2013?

A company had net sales of $541,500 in 2013 and $475,300 in 2014.Its average assets were $410,000 for 2013 and $400,000 for 2014.(1) Calculate the total asset turnover for each year.(2) Interpret and comment on the company's efficiency in the use of its assets.

A company purchased equipment for $50,000 on January 1,2012.The equipment was sold for $10,000 on December 31,2015.Accumulated Depreciation in the amount of $40,000 had been recorded through that date.How would the company record this transaction?

Introducing Financial Accounting

Accounting System and Financial Statements

Adjusting Accounts for Financial Statements

Reporting and Analyzing Merchandising Operations

Reporting and Analyzing Inventories

Reporting and Analyzing Cash and Internal Controls

Reporting and Analyzing Receivables

Reporting and Analyzing Current Liabilities

Reporting and Analyzing Long-Term Liabilities

Reporting and Analyzing Equity

Reporting and Analyzing Cash Flows

Analyzing and Interpreting Financial Statements

Applying Present and Future Values

Investments and International Operations

Accounting for Partnerships

Accounting With Special Journals

Filters