Question 1

Land acquired so it can be resold in the future is listed on the balance sheet as a(n)

Accepted Answer

A)  fixed asset 
B)  current asset 
C)  investment 
D)  intangible asset 
A)  fixed asset 
B)  current asset 
C)  investment 
D)  intangible asset

Question 2

When a property, plant, and equipment asset is sold for cash, any gain or loss on the asset sold should be recorded.

Accepted Answer

A) True 
 B)False

Question 3

When a company establishes an outstanding reputation and has a competitive advantage because of it, the company should record goodwill on its financial statements.

Accepted Answer

A) True 
 B)False

Question 4

Classify each of the following as:
-Exterior and interior painting

Accepted Answer

A) Ordinary maintenance and repairs 
B) Asset improvements 
C) Extraordinary repairs 
A) Ordinary maintenance and repairs 
B) Asset improvements 
C) Extraordinary repairs

Question 5

Though a piece of equipment is still being used, the equipment should be removed from the accounts if it has been fully depreciated.

Accepted Answer

A) True 
 B)False

Question 6

A used machine with a purchase price of $77,000, requiring an overhaul costing $8,000, installation costs of $5,000, and special acquisition fees of $3,000, would have a cost basis of

Accepted Answer

A)  $93,000 
B)  $90,000 
C)  $82,000 
D)  $85,000 
A)  $93,000 
B)  $90,000 
C)  $82,000 
D)  $85,000

Question 7

Prior to adjustment at the end of the year, the balance in Trucks is $300,900 and the balance in Accumulated Depreciation-Trucks is $88,200. Details of the subsidiary ledger are as follows:
​   ​
Required:

Accepted Answer

(a) @#IMG-DLM&_TB228

Question 8

The process of transferring the cost of metal ores and other minerals removed from the earth to an expense account is called

Accepted Answer

A)  depletion 
B)  deferral 
C)  amortization 
D)  depreciation 
A)  depletion 
B)  deferral 
C)  amortization 
D)  depreciation

Question 9

The cost of new equipment is called a revenue expenditure because it will help generate revenues in the future.

Accepted Answer

A) True 
 B)False

Question 10

When the amount of use of a fixed asset varies from year to year, the method of determining depreciation expense that best matches allocation of cost with revenue is

Accepted Answer

A)  double-declining-balance method 
B)  straight-line method 
C)  units-of-output method 
D)  MACRS 
A)  double-declining-balance method 
B)  straight-line method 
C)  units-of-output method 
D)  MACRS

Question 11

The method used to calculate the depletion of a natural resource is the straight-line method.

Accepted Answer

A) True 
 B)False

Question 12

A machine costing $185,000 with a 5-year life and $20,000 residual value was purchased January 2. Compute depreciation for each of the five years, using the double-declining-balance method.

Accepted Answer

The answer of A machine costing $185,000 with a 5-year...

Question 13

Which of the following are criteria for determining whether to record an asset as a fixed asset?

Accepted Answer

A)  must be an investment and long lived 
B)  must be long lived and used by the company in its normal operations 
C)  must be short lived and tangible 
D)  must be tangible and an investment 
A)  must be an investment and long lived 
B)  must be long lived and used by the company in its normal operations 
C)  must be short lived and tangible 
D)  must be tangible and an investment

Question 14

A leased asset will appear on the balance sheet as a long-term asset.

Accepted Answer

A) True 
 B)False

Question 15

Copy equipment was acquired at the beginning of the year at a cost of $72,000 that has an estimated residual value of $9,000 and an estimated useful life of 5 years. It is estimated that the machine will output an estimated 1,000,000 copies. This year, 315,000 copies were made. What is the units-of-output depreciation for the year?

Accepted Answer

A)  $22,050 
B)  $18,900 
C)  $22,680 
D)  $19,845 
A)  $22,050 
B)  $18,900 
C)  $22,680 
D)  $19,845

Question 16

The cost of replacing an engine in a truck is an example of ordinary maintenance.

Accepted Answer

A) True 
 B)False

Question 17

When exchanging equipment, if the trade-in allowance is greater than the book value a loss results.

Accepted Answer

A) True 
 B)False

Question 18

Fill in the missing numbers using the formula for fixed asset turnover: $$\begin{array} { | l | r | r | r | r | } 
\hline & \text { Company A } & \text { Company B } & \text { Company C } & \text { Company D } \
\hline \text { Sales } & \$ 5,000,000 & \$ 720,000 & \$ 900,000 & ? \
\hline \text { Beginning fixed assets } & \$ 450,000 & \$ 275,000 & ? & \$ 380,000 \
\hline \text { Ending fixed assets } & \$ 800,000 & ? & \$ 310,000 & \$ 420,000 \
\hline \text { Fixed asset turnover } & ? & 2.4 \text { times } & 3 \text { times } & 2.6 \text { times } \
\hline
\end{array}$$

Accepted Answer

The answer of Fill in the missing numbers using the...

Question 19

A machine with a cost of $75,000 has an estimated residual value of $5,000 and an estimated life of 4 years or 18,000 hours. What is the amount of depreciation for the second full year, using the double-declining-balance method?

Accepted Answer

A)  $17,500 
B)  $37,500 
C)  $18,750 
D)  $16,667 
A)  $17,500 
B)  $37,500 
C)  $18,750 
D)  $16,667

Question 20

Accumulated Depreciation-Buildings

Accepted Answer

A) Current Assets 
B) Fixed Assets 
C) Intangible Assets 
D) Current Liability 
E) Long-Term Liability
F)Owners' Equity
G)Revenues
H)Operating Expenses
I)Other Income/Expense 
A) Current Assets 
B) Fixed Assets 
C) Intangible Assets 
D) Current Liability 
E) Long-Term Liability
F)Owners' Equity
G)Revenues
H)Operating Expenses
I)Other Income/Expense

Land acquired so it can be resold in the future is listed on the balance sheet as a(n)

When a property, plant, and equipment asset is sold for cash, any gain or loss on the asset sold should be recorded.

When a company establishes an outstanding reputation and has a competitive advantage because of it, the company should record goodwill on its financial statements.

Classify each of the following as: -Exterior and interior painting

Though a piece of equipment is still being used, the equipment should be removed from the accounts if it has been fully depreciated.

A used machine with a purchase price of $77,000, requiring an overhaul costing $8,000, installation costs of $5,000, and special acquisition fees of $3,000, would have a cost basis of

Prior to adjustment at the end of the year, the balance in Trucks is $300,900 and the balance in Accumulated Depreciation-Trucks is $88,200. Details of the subsidiary ledger are as follows: Required:

The process of transferring the cost of metal ores and other minerals removed from the earth to an expense account is called

The cost of new equipment is called a revenue expenditure because it will help generate revenues in the future.

When the amount of use of a fixed asset varies from year to year, the method of determining depreciation expense that best matches allocation of cost with revenue is

The method used to calculate the depletion of a natural resource is the straight-line method.

A machine costing $185,000 with a 5-year life and $20,000 residual value was purchased January 2. Compute depreciation for each of the five years, using the double-declining-balance method.

Which of the following are criteria for determining whether to record an asset as a fixed asset?

A leased asset will appear on the balance sheet as a long-term asset.

The cost of replacing an engine in a truck is an example of ordinary maintenance.

When exchanging equipment, if the trade-in allowance is greater than the book value a loss results.

A machine with a cost of $75,000 has an estimated residual value of $5,000 and an estimated life of 4 years or 18,000 hours. What is the amount of depreciation for the second full year, using the double-declining-balance method?

Accumulated Depreciation-Buildings

Accounting and Business

Double-Entry Accounting

Adjustments: Accruals and Deferrals

The Accounting Cycle

Accounting for Retail Businesses

Inventories

Internal Control and Cash

Receivables

Liabilities: Current, Installment Notes, and Contingencies

Liabilities: Bonds Payable

Corporations: Organization, Stock Transactions, and Dividends

Statement of Cash Flows

Financial Statement Analysis

Investments

Filters

Exam 9: Long-Term Assets: Fixed and Intangible

Land acquired so it can be resold in the future is listed on the balance sheet as a(n)

When a property, plant, and equipment asset is sold for cash, any gain or loss on the asset sold should be recorded.

When a company establishes an outstanding reputation and has a competitive advantage because of it, the company should record goodwill on its financial statements.

Classify each of the following as: -Exterior and interior painting

Though a piece of equipment is still being used, the equipment should be removed from the accounts if it has been fully depreciated.

A used machine with a purchase price of $77,000, requiring an overhaul costing $8,000, installation costs of $5,000, and special acquisition fees of $3,000, would have a cost basis of

Prior to adjustment at the end of the year, the balance in Trucks is $300,900 and the balance in Accumulated Depreciation-Trucks is $88,200. Details of the subsidiary ledger are as follows: ​ ​ Required:

The process of transferring the cost of metal ores and other minerals removed from the earth to an expense account is called

The cost of new equipment is called a revenue expenditure because it will help generate revenues in the future.

When the amount of use of a fixed asset varies from year to year, the method of determining depreciation expense that best matches allocation of cost with revenue is

The method used to calculate the depletion of a natural resource is the straight-line method.

A machine costing $185,000 with a 5-year life and $20,000 residual value was purchased January 2. Compute depreciation for each of the five years, using the double-declining-balance method.

Which of the following are criteria for determining whether to record an asset as a fixed asset?

A leased asset will appear on the balance sheet as a long-term asset.

The cost of replacing an engine in a truck is an example of ordinary maintenance.

When exchanging equipment, if the trade-in allowance is greater than the book value a loss results.

A machine with a cost of $75,000 has an estimated residual value of $5,000 and an estimated life of 4 years or 18,000 hours. What is the amount of depreciation for the second full year, using the double-declining-balance method?

Accumulated Depreciation-Buildings

Accounting and Business

Double-Entry Accounting

Adjustments: Accruals and Deferrals

The Accounting Cycle

Accounting for Retail Businesses

Inventories

Internal Control and Cash

Receivables

Liabilities: Current, Installment Notes, and Contingencies

Liabilities: Bonds Payable

Corporations: Organization, Stock Transactions, and Dividends

Statement of Cash Flows

Financial Statement Analysis

Investments

Filters

Prior to adjustment at the end of the year, the balance in Trucks is $300,900 and the balance in Accumulated Depreciation-Trucks is $88,200. Details of the subsidiary ledger are as follows: Required: