Question 1

The depreciation method that does not use residual value in calculating the first year's depreciation expense is

Accepted Answer

A) straight-line 
B) units-of-activity 
C) double-declining-balance 
D) sum-of-the-years-digits 
A) straight-line 
B) units-of-activity 
C) double-declining-balance 
D) sum-of-the-years-digits

Question 2

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

Accepted Answer

A) True 
 B)False

Question 3

Comment on the validity of the following statements."As an asset loses its ability to provide services,cash needs to be set aside to replace it.Depreciation accomplishes this goal."

Accepted Answer

Depreciation is the periodic t

Question 4

The double-declining-balance method is an accelerated depreciation method.

Accepted Answer

A) True 
 B)False

Question 5

A fixed asset with a cost of $41,000 and accumulated depreciation of $36,000 is traded for a similar asset priced at $50,000 (fair market value)in a transaction with commercial substance.Assuming a trade-in allowance of $4,000,at what cost will the new equipment be recorded in the books?

Accepted Answer

A) $54,000 
B) $45,000 
C) $51,000 
D) $50,000 
A) $54,000 
B) $45,000 
C) $51,000 
D) $50,000

Question 6

A copy machine acquired on July 1 with a cost of $1,450 has an estimated useful life of four years.Assuming that it will have a residual value of $250,determine the depreciation for the first year by the double-declining-balance method.

Accepted Answer

First-Year Depreciat

Question 7

Match each account name to the financial statement section (a-i) in which it would appear.
-Accumulated Depreciation-Buildings

Accepted Answer

A) Current assets 
B) Fixed assets 
C) Intangible assets 
D) Current liability 
E) Long-term liability
F)Owner's equity
G)Revenues
H)Operating expenses
I)Other revenue and expense 
A) Current assets 
B) Fixed assets 
C) Intangible assets 
D) Current liability 
E) Long-term liability
F)Owner's equity
G)Revenues
H)Operating expenses
I)Other revenue and expense

Question 8

Bacon Company acquired new machinery with a price of $15,200 by trading in similar old machinery and paying $12,700.The old machinery originally cost $9,000 and had accumulated depreciation of $5,000.In recording this transaction,Bacon Company should record

Accepted Answer

A) the new machinery at $16,700 
B) the new machinery at $12,700 
C) a gain of $1,500 
D) a loss of $1,500 
A) the new machinery at $16,700 
B) the new machinery at $12,700 
C) a gain of $1,500 
D) a loss of $1,500

Question 9

Classify each of the following costs associated with long-lived assets as one of the following:
-Modifying a building purchased for new business location

Accepted Answer

A) Land improvements 
B) Buildings 
C) Land 
D) Machinery and equipment 
A) Land improvements 
B) Buildings 
C) Land 
D) Machinery and equipment

Question 10

A fixed asset's estimated value at the time it is to be retired from service is called

Accepted Answer

A) book value 
B) residual value 
C) market value 
D) carrying value 
A) book value 
B) residual value 
C) market value 
D) carrying value

Question 11

Classify each of the following costs associated with long-lived assets as one of the following:
-Costs to survey a new piece of land for a new business location

Accepted Answer

A) Buildings 
B) Machinery and equipment 
C) Land 
D) Land improvements 
A) Buildings 
B) Machinery and equipment 
C) Land 
D) Land improvements

Question 12

XYZ Co.incurred the following costs related to the office building used in operating its sports supply company:​   Classify each of the costs as a capital expenditure or a revenue expenditure.

Accepted Answer

(a) Revenue expenditure
(b) Ca

Question 13

On July 1,Sterns Co.acquired patent rights for $36,000.The patent has a useful life of six years and a legal life of 15 years.Journalize the adjusting entry on December 31 to recognize the amortization.Journal

Accepted Answer

JournalAnnual Patent Amortizat

Question 14

The normal balance of the accumulated depreciation account is a debit.

Accepted Answer

A) True 
 B)False

Question 15

On December 31,Strike Company has decided to discard one of its batting cages.The equipment had an initial cost of $310,000 and has accumulated depreciation of $260,000.Depreciation has been recorded up to the end of the year.Which of the following will be included in the entry to record the disposal?

Accepted Answer

A) Accumulated Depreciation, debit, $310,000 
B) Loss on Disposal of Asset, debit, $260,000 
C) Equipment, credit, $310,000 
D) Gain on Disposal of Asset, credit, $50,000 
A) Accumulated Depreciation, debit, $310,000 
B) Loss on Disposal of Asset, debit, $260,000 
C) Equipment, credit, $310,000 
D) Gain on Disposal of Asset, credit, $50,000

Question 16

Match each account name to the financial statement section (a-i) in which it would appear.
-Land Improvements

Accepted Answer

A) Current assets 
B) Fixed assets 
C) Intangible assets 
D) Current liability 
E) Long-term liability
F)Owner's equity
G)Revenues
H)Operating expenses
I)Other revenue and expense 
A) Current assets 
B) Fixed assets 
C) Intangible assets 
D) Current liability 
E) Long-term liability
F)Owner's equity
G)Revenues
H)Operating expenses
I)Other revenue and expense

Question 17

When a company exchanges machinery and receives a trade-in allowance greater than the book value,this transaction would be recorded with which of the following entries (assuming the exchange was considered to have commercial substance)?

Accepted Answer

A) debit Machinery and Accumulated Depreciation; credit Machinery, Cash, and Gain on Exchange of Machinery 
B) debit Machinery and Accumulated Depreciation; credit Machinery and Cash 
C) debit Cash and Machinery; credit Accumulated Depreciation 
D) debit Cash and Machinery; credit Accumulated Depreciation and Machinery 
A) debit Machinery and Accumulated Depreciation; credit Machinery, Cash, and Gain on Exchange of Machinery 
B) debit Machinery and Accumulated Depreciation; credit Machinery and Cash 
C) debit Cash and Machinery; credit Accumulated Depreciation 
D) debit Cash and Machinery; credit Accumulated Depreciation and Machinery

Question 18

Classify each of the following costs associated with long-lived assets as one of the following:
-Cost of insurance during the construction of new office building

Accepted Answer

A) Buildings 
B) Machinery and equipment 
C) Land 
D) Land improvements 
A) Buildings 
B) Machinery and equipment 
C) Land 
D) Land improvements

Question 19

The proper journal entry to purchase a computer costing $975 on account to be utilized within the business would be

Accepted Answer

A) Office Supplies 975Accounts Payable 975 
B) Office Equipment 975Accounts Payable 975 
C) Office Supplies 975Accounts Receivable 975 
D) Office Equipment 975Accounts Receivable 975 
A) Office Supplies 975Accounts Payable 975 
B) Office Equipment 975Accounts Payable 975 
C) Office Supplies 975Accounts Receivable 975 
D) Office Equipment 975Accounts Receivable 975

The depreciation method that does not use residual value in calculating the first year's depreciation expense is

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

Comment on the validity of the following statements."As an asset loses its ability to provide services,cash needs to be set aside to replace it.Depreciation accomplishes this goal."

The double-declining-balance method is an accelerated depreciation method.

A fixed asset with a cost of $41,000 and accumulated depreciation of $36,000 is traded for a similar asset priced at $50,000 (fair market value)in a transaction with commercial substance.Assuming a trade-in allowance of $4,000,at what cost will the new equipment be recorded in the books?

A copy machine acquired on July 1 with a cost of $1,450 has an estimated useful life of four years.Assuming that it will have a residual value of $250,determine the depreciation for the first year by the double-declining-balance method.

Match each account name to the financial statement section (a-i) in which it would appear. -Accumulated Depreciation-Buildings

Bacon Company acquired new machinery with a price of $15,200 by trading in similar old machinery and paying $12,700.The old machinery originally cost $9,000 and had accumulated depreciation of $5,000.In recording this transaction,Bacon Company should record

Classify each of the following costs associated with long-lived assets as one of the following: -Modifying a building purchased for new business location

A fixed asset's estimated value at the time it is to be retired from service is called

Classify each of the following costs associated with long-lived assets as one of the following: -Costs to survey a new piece of land for a new business location

XYZ Co.incurred the following costs related to the office building used in operating its sports supply company: Classify each of the costs as a capital expenditure or a revenue expenditure.

On July 1,Sterns Co.acquired patent rights for $36,000.The patent has a useful life of six years and a legal life of 15 years.Journalize the adjusting entry on December 31 to recognize the amortization.Journal

The normal balance of the accumulated depreciation account is a debit.

Match each account name to the financial statement section (a-i) in which it would appear. -Land Improvements

When a company exchanges machinery and receives a trade-in allowance greater than the book value,this transaction would be recorded with which of the following entries (assuming the exchange was considered to have commercial substance)?

Classify each of the following costs associated with long-lived assets as one of the following: -Cost of insurance during the construction of new office building

The proper journal entry to purchase a computer costing $975 on account to be utilized within the business would be

Introduction to Accounting and Business

Analyzing Transactions

The Adjusting Process

Completing the Accounting Cycle

Accounting Systems

Accounting for Merchandising Businesses

Inventories

Internal Control and Cash

Receivables

Current Liabilities and Payroll

Accounting for Partnerships and Limited Liability Companies

Corporations: Organization, stock Transactions, and Dividends

Long-Term Liabilities: Bonds and Notes

Investments and Fair Value Accounting

Statement of Cash Flows

Financial Statement Analysis

Filters

Exam 10: Long-Term Assets: Fixed and Intangible

The depreciation method that does not use residual value in calculating the first year's depreciation expense is

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

Comment on the validity of the following statements."As an asset loses its ability to provide services,cash needs to be set aside to replace it.Depreciation accomplishes this goal."

The double-declining-balance method is an accelerated depreciation method.

A fixed asset with a cost of $41,000 and accumulated depreciation of $36,000 is traded for a similar asset priced at $50,000 (fair market value)in a transaction with commercial substance.Assuming a trade-in allowance of $4,000,at what cost will the new equipment be recorded in the books?

A copy machine acquired on July 1 with a cost of $1,450 has an estimated useful life of four years.Assuming that it will have a residual value of $250,determine the depreciation for the first year by the double-declining-balance method.

Match each account name to the financial statement section (a-i) in which it would appear. -Accumulated Depreciation-Buildings

Bacon Company acquired new machinery with a price of $15,200 by trading in similar old machinery and paying $12,700.The old machinery originally cost $9,000 and had accumulated depreciation of $5,000.In recording this transaction,Bacon Company should record

Classify each of the following costs associated with long-lived assets as one of the following: -Modifying a building purchased for new business location

A fixed asset's estimated value at the time it is to be retired from service is called

Classify each of the following costs associated with long-lived assets as one of the following: -Costs to survey a new piece of land for a new business location

XYZ Co.incurred the following costs related to the office building used in operating its sports supply company:​ Classify each of the costs as a capital expenditure or a revenue expenditure.

On July 1,Sterns Co.acquired patent rights for $36,000.The patent has a useful life of six years and a legal life of 15 years.Journalize the adjusting entry on December 31 to recognize the amortization.Journal

The normal balance of the accumulated depreciation account is a debit.

Match each account name to the financial statement section (a-i) in which it would appear. -Land Improvements

When a company exchanges machinery and receives a trade-in allowance greater than the book value,this transaction would be recorded with which of the following entries (assuming the exchange was considered to have commercial substance)?

Classify each of the following costs associated with long-lived assets as one of the following: -Cost of insurance during the construction of new office building

The proper journal entry to purchase a computer costing $975 on account to be utilized within the business would be

Introduction to Accounting and Business

Analyzing Transactions

The Adjusting Process

Completing the Accounting Cycle

Accounting Systems

Accounting for Merchandising Businesses

Inventories

Internal Control and Cash

Receivables

Current Liabilities and Payroll

Accounting for Partnerships and Limited Liability Companies

Corporations: Organization, stock Transactions, and Dividends

Long-Term Liabilities: Bonds and Notes

Investments and Fair Value Accounting

Statement of Cash Flows

Financial Statement Analysis

Filters

XYZ Co.incurred the following costs related to the office building used in operating its sports supply company: Classify each of the costs as a capital expenditure or a revenue expenditure.