Question 1

All property, plant, and equipment assets are depreciated over time.

Accepted Answer

A) True 
 B)False

Question 2

When cities give land or buildings to a company to locate in the community, no entry is made since there is no cost to the company.

Accepted Answer

A) True 
 B)False

Question 3

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

Accepted Answer

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

Question 4

Standby equipment held for use in the event of a breakdown of regular equipment is reported as property, plant, and equipment on the balance sheet.

Accepted Answer

A) True 
 B)False

Question 5

The calculation for annual depreciation using the straight-line depreciation method is

Accepted Answer

A)  initial cost / estimated useful life 
B)  depreciable cost / estimated useful life 
C)  depreciable cost * estimated useful life 
D)  initial cost * estimated useful life 
A)  initial cost / estimated useful life 
B)  depreciable cost / estimated useful life 
C)  depreciable cost * estimated useful life 
D)  initial cost * estimated useful life

Question 6

On December 31, Strike Company has decided to trade-in one of its batting cages for another one that has a cost of $500,000. The seller of the batting cage is willing to allow a trade-in amount of $11,000. The initial cost of the old equipment was $215,000 with an accumulated depreciation of $185,000. Depreciation has been taken up to the end of the year. The difference will be paid in cash. What is the amount of the gain or loss on this transaction?

Accepted Answer

A)  Loss of $11,000 
B)  Gain of $11,000 
C)  Loss of $19,000 
D)  No loss or gain will be recorded. 
A)  Loss of $11,000 
B)  Gain of $11,000 
C)  Loss of $19,000 
D)  No loss or gain will be recorded.

Question 7

Which of the following is true?

Accepted Answer

A)  If using the double-declining-balance the total amount of depreciation expense during the life of the asset will be the highest. 
B)  If using the units-of-production method, it is possible to depreciate more than the depreciable cost. 
C)  If using the straight line method, the amount of depreciation expense during the first year is higher than that of the double-declining-balance. 
D)  Regardless of the depreciation method, the amount of total depreciation expense during the life of the asset will be the same. 
A)  If using the double-declining-balance the total amount of depreciation expense during the life of the asset will be the highest. 
B)  If using the units-of-production method, it is possible to depreciate more than the depreciable cost. 
C)  If using the straight line method, the amount of depreciation expense during the first year is higher than that of the double-declining-balance. 
D)  Regardless of the depreciation method, the amount of total depreciation expense during the life of the asset will be the same.

Question 8

Eagle Country Club has acquired a lot to construct a clubhouse. Eagle had the following costs related to the construction:
   Determine the cost of the Club House to be reported on the balance sheet.

Accepted Answer

@#IMG-DLM&_TB2085_00

Question 9

The units of production depreciation method provides a good match of expenses against revenue.

Accepted Answer

A) True 
 B)False

Question 10

When determining whether to record an asset as a fixed asset, what two criteria must be met?

Accepted Answer

A)  Must be an investment and must be long lived. 
B)  Must be long lived and must use the asset in a productive manner. 
C)  Must be short lived and must be a tangible asset. 
D)  Must be a tangible asset and must be an investment. 
A)  Must be an investment and must be long lived. 
B)  Must be long lived and must use the asset in a productive manner. 
C)  Must be short lived and must be a tangible asset. 
D)  Must be a tangible asset and must be an investment.

Question 11

A gain can be realized when a fixed asset is discarded.

Accepted Answer

A) True 
 B)False

Question 12

An asset was purchased for $120,000 on January 1, 2010 and originally estimated to have a useful life of 10 years with a residual value of $10,000. At the beginning of 2012, it was determined that the remaining useful life of the asset was only 4 years with a residual value of $2,000. Calculate the 2012 depreciation expense using the revised amounts and straight line method.

Accepted Answer

A)  $25,000 
B)  $11,000 
C)  $24,000 
D)  $24,500 
A)  $25,000 
B)  $11,000 
C)  $24,000 
D)  $24,500

All property, plant, and equipment assets are depreciated over time.

When cities give land or buildings to a company to locate in the community, no entry is made since there is no cost to the company.

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

Standby equipment held for use in the event of a breakdown of regular equipment is reported as property, plant, and equipment on the balance sheet.

The calculation for annual depreciation using the straight-line depreciation method is

Which of the following is true?

Eagle Country Club has acquired a lot to construct a clubhouse. Eagle had the following costs related to the construction: Determine the cost of the Club House to be reported on the balance sheet.

The units of production depreciation method provides a good match of expenses against revenue.

When determining whether to record an asset as a fixed asset, what two criteria must be met?

A gain can be realized when a fixed asset is discarded.

Introduction to Accounting and Business

Analyzing Transactions

The Adjusting Process

Completing the Accounting Cycle

Accounting Systems

Accounting for Merchandising Businesses

Inventories

Sarbanes-Oxley, 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: Fixed Assets and Intangible Assets

All property, plant, and equipment assets are depreciated over time.

When cities give land or buildings to a company to locate in the community, no entry is made since there is no cost to the company.

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

Standby equipment held for use in the event of a breakdown of regular equipment is reported as property, plant, and equipment on the balance sheet.

The calculation for annual depreciation using the straight-line depreciation method is

Which of the following is true?

Eagle Country Club has acquired a lot to construct a clubhouse. Eagle had the following costs related to the construction: Determine the cost of the Club House to be reported on the balance sheet.

The units of production depreciation method provides a good match of expenses against revenue.

When determining whether to record an asset as a fixed asset, what two criteria must be met?

A gain can be realized when a fixed asset is discarded.

Introduction to Accounting and Business

Analyzing Transactions

The Adjusting Process

Completing the Accounting Cycle

Accounting Systems

Accounting for Merchandising Businesses

Inventories

Sarbanes-Oxley, 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