Exam 16: Accounting for Property, Plant, Equipment, and Intangible Assets

Mount Company purchased a machine at an invoice cost of $26,000 subject to terms of 2/10, n/30. The discount was taken. Additional costs were installation, $1,200; insurance on the machine after it was in operation, $300. The total cost to be added to the machinery account is:

Which depreciation method uses twice the straight-line rate?

The cost of a plant asset was increased for the payment of this year's insurance premium. This error would cause:

Land is not depreciated.

Assembly costs, and any other costs necessary to get a machine ready for operation, including freight costs, would be added to the cost of the machine.

A computer server system, which had cost $250,000 and had accumulated depreciation of $170,000, was traded for a new system with a fair market value of $245,000. The old system and cash of $190,000 were given for the new system. Prepare the journal entry for the exchange of these similar assets.

Burlington Industries purchased a plant asset to be used in its business. The expenditures included: The Machine account will be debited for ________.

The cost of equipment is expensed:

For each of the following, identify in column 1 the category to which the account belongs, in column 2 the normal balance for the account, in column 3 the financial statement that the account in which the account balance is reported, and in column 4 the account's nature (permanent/temporary). -

A company purchased new machinery and incurred freight, assembly, and installation costs in addition to the invoice cost of the machinery. These additional costs should be debited to:

The depreciation method in which an even amount of depreciation expense is taken each year is called:

Which depreciation method deducts residual value when computing depreciation expense?

The depreciation method that ignores the salvage value is ________.

Journalize the following transactions for Pets R Us: Mar. 5 Sold a truck for $10,000 that cost $15,000 and had an accumulated depreciation of $12,000. Mar. 10 A machine costing $13,000 with accumulated depreciation of $10,500 was destroyed in a fire. No claim was filed. May 15 Traded in a machine costing $25,000, with $19,000 of accumulated depreciation, for a new machine costing $32,000 with a trade-in allowance of$ 9,000.

Pace Works traded a plant asset with a cost of $29,000 and accumulated depreciation of $26,000 for a similar asset priced at $69,000. Assuming a trade-in of $3,100, the cost basis of the new asset under income tax rules is:

Lacy purchased equipment for $76,000 on January 1. Its residual value is $4,000 with a useful life of 9 years. The amount of depreciation expense in the first year under the straight-line method is: (Round your answer to the nearest dollar.)

Using MACRS rates for a 15 and 20-year property, what is the percentage for the depreciable rate?

The entry to record the purchase of a machine on account that costs $10,000, installation costs, $1,000, and freight, $600, would be:

Which of the following assets would be classified as property, plant, and equipment?

The difference between the item's cost and accumulated depreciation is the ________.