Question 1

Cost minus salvage value is called amortizable cost.

Accepted Answer

A) True 
 B)False

Question 2

The renewal option period is excluded from the amortization period for leasehold improvements.

Accepted Answer

A) True 
 B)False

Question 3

Which of the following expenditures would be debited to an expense account?

Accepted Answer

A) cost to rebuild the company car's engine 
B) cost to replace the engine of the company car 
C) cost to paint the car after a fender bender 
D) cost to replace the transmission of the company car 
A) cost to rebuild the company car's engine 
B) cost to replace the engine of the company car 
C) cost to paint the car after a fender bender 
D) cost to replace the transmission of the company car

Question 4

Jackson Construction Company Ltd. paid $42,000 for equipment with a fair market value of $46,000. Jackson Construction Company Ltd. will record equipment at:

Accepted Answer

A) $42,000. 
B) $46,000. 
C) either $42,000 or $46,000. 
D) $44,000 (average). 
A) $42,000. 
B) $46,000. 
C) either $42,000 or $46,000. 
D) $44,000 (average).

Question 5

June Company Ltd. recently sold some used furniture for $3,800 cash. The furniture cost $19,600 and had accumulated amortization through the date of sale totalling $17,300. The journal entry to record the sale of the furniture is:

Accepted Answer

A)  $\begin{array} { | l | r | r | } 
\hline \text { Cash } & 3,800 & \
\hline \text { Accum. Amort.-Furniture } & 17,300 & \
\hline \text { Furniture } & & 19,600 \
\hline \begin{array} { c } 
\text { Gain on Sale of } \
\text { Furniture }
\end{array} & & 1,500 \
\hline
\end{array}$ 
B)  $\begin{array} { | l | r | r | } 
\hline \text { Cash } & 3,800 & \
\hline \text { Furniture } & & 3,800 \
\hline
\end{array}$ 
C)  $\begin{array} { | c | r | r | } 
\hline \text { Cash } & 3,800 & \
\hline \text { Gain on Sale of } & & \
\text { Furniture } & & 3,800 \
\hline
\end{array}$ 
D)  $\begin{array} { | l | r | r | } 
\hline \text { Cash } & 3,800 & \
\hline \text { Accum. Amort.-Furniture } & 15,800 & \
\hline \text { Furniture } & & 19,600 \
\hline
\end{array}$ 
A)  $\begin{array} { | l | r | r | } 
\hline \text { Cash } & 3,800 & \
\hline \text { Accum. Amort.-Furniture } & 17,300 & \
\hline \text { Furniture } & & 19,600 \
\hline \begin{array} { c } 
\text { Gain on Sale of } \
\text { Furniture }
\end{array} & & 1,500 \
\hline
\end{array}$ 
B)  $\begin{array} { | l | r | r | } 
\hline \text { Cash } & 3,800 & \
\hline \text { Furniture } & & 3,800 \
\hline
\end{array}$ 
C)  $\begin{array} { | c | r | r | } 
\hline \text { Cash } & 3,800 & \
\hline \text { Gain on Sale of } & & \
\text { Furniture } & & 3,800 \
\hline
\end{array}$ 
D)  $\begin{array} { | l | r | r | } 
\hline \text { Cash } & 3,800 & \
\hline \text { Accum. Amort.-Furniture } & 15,800 & \
\hline \text { Furniture } & & 19,600 \
\hline
\end{array}$

Question 6

A fully amortized asset no longer has value to the business.

Accepted Answer

A) True 
 B)False

Question 7

Utsman Enterprises Ltd. purchased land, buildings, and equipment for $2,400,000. The land has been appraised at $865,000, the buildings at $1,175,000, and the equipment at $510,000. The equipment account will be debited for:

Accepted Answer

A) $500,000. 
B) $525,000. 
C) $410,156. 
D) $480,000. 
A) $500,000. 
B) $525,000. 
C) $410,156. 
D) $480,000.

Question 8

A fully amortized asset always has a book value of zero.

Accepted Answer

A) True 
 B)False

Question 9

If amortization expense for an asset is the same every year, which method is being used?

Accepted Answer

A) straight-line 
B) units-of-production 
C) double-declining-balance 
D) either units-of-production or double-declining-balance 
A) straight-line 
B) units-of-production 
C) double-declining-balance 
D) either units-of-production or double-declining-balance

Cost minus salvage value is called amortizable cost.

The renewal option period is excluded from the amortization period for leasehold improvements.

Which of the following expenditures would be debited to an expense account?

Jackson Construction Company Ltd. paid $42,000 for equipment with a fair market value of $46,000. Jackson Construction Company Ltd. will record equipment at:

June Company Ltd. recently sold some used furniture for $3,800 cash. The furniture cost $19,600 and had accumulated amortization through the date of sale totalling $17,300. The journal entry to record the sale of the furniture is:

A fully amortized asset no longer has value to the business.

Utsman Enterprises Ltd. purchased land, buildings, and equipment for $2,400,000. The land has been appraised at $865,000, the buildings at $1,175,000, and the equipment at $510,000. The equipment account will be debited for:

A fully amortized asset always has a book value of zero.

If amortization expense for an asset is the same every year, which method is being used?

Accounting and the Business Environment

Recording Business Transactions

Measuring Business Income: The Adjusting Process

Completing the Accounting Cycle

Merchandising Operations and the Accounting Cycle

Accounting for Merchandise Inventory

Accounting Information Systems

Internal Control and Cash

Receivables

Current Liabilities and Payroll

Filters

Exam 10: Property, Plant, and Equipment; Goodwill; and Intangibles

Cost minus salvage value is called amortizable cost.

The renewal option period is excluded from the amortization period for leasehold improvements.

Which of the following expenditures would be debited to an expense account?

Jackson Construction Company Ltd. paid $42,000 for equipment with a fair market value of $46,000. Jackson Construction Company Ltd. will record equipment at:

June Company Ltd. recently sold some used furniture for $3,800 cash. The furniture cost $19,600 and had accumulated amortization through the date of sale totalling $17,300. The journal entry to record the sale of the furniture is:

A fully amortized asset no longer has value to the business.

Utsman Enterprises Ltd. purchased land, buildings, and equipment for $2,400,000. The land has been appraised at $865,000, the buildings at $1,175,000, and the equipment at $510,000. The equipment account will be debited for:

A fully amortized asset always has a book value of zero.

If amortization expense for an asset is the same every year, which method is being used?

Accounting and the Business Environment

Recording Business Transactions

Measuring Business Income: The Adjusting Process

Completing the Accounting Cycle

Merchandising Operations and the Accounting Cycle

Accounting for Merchandise Inventory

Accounting Information Systems

Internal Control and Cash

Receivables

Current Liabilities and Payroll

Filters