Exam 9: Long-Lived Tangible and Intangible Assets

On September 1,Emil Rovey purchased a vehicle for $57,500 with a residual value of $7,500.The estimated useful life is 5 years and the company uses the straight-line method.What is the depreciation expense for the year ended December 31?

Matching part of the cost of a long-lived asset with the revenues generated by the asset is:

MacKenzie Manufacturing purchased equipment for $160,000.In addition,shipping charges of $2,000 were incurred to obtain the equipment.The company paid $12,500 to construct a foundation and install the equipment.The equipment is estimated to have a residual value of $15,000 at the end of its 5-year useful life. Using the straight-line method,what is the book value of the equipment at the end of the third full year of use?

On January 1,2017,Xit Company bought a new delivery truck for $30,000.Xit plans to use the truck for 4 years,after which it will be sold for $6,000.Depreciation expense for 2020,the fourth year of use,using double-declining-balance equals:

On January 1,2018,Manzanita Manufacturing purchased a machine for $345,000 with an expected life of 5 years and a residual value of $37,500.In addition,the company paid delivery costs of $3,000 and $12,000 to have the machine installed.Manzanita uses the double-declining-balance method of depreciation. If the company sells the machine at the end of 5 years and receives $28,750,the journal entry to record the sale will include which of the following?

A company sells a piece of equipment half-way through the accounting period.The straight-line rate of depreciation on the equipment is $40,000 per year.Before preparing the entry to record the sale of the equipment,the company should first debit:

Which of the following is not an amount that is needed to calculate straight-line depreciation?

If a company wants to receive exclusive rights to a manufacturing process,it should obtain a:

Sony,Inc.spent $1,000,000 of development cost for commercially feasible prototypes.If Sony follows IFRS not GAAP,then the $1,000,000 would:

Match each term with the appropriate explanation.Not all explanations will be used. -Declining-balance method

All costs to get an asset in place and ready for use should be:

A company sells equipment for $450,000 when the book value of the equipment is $400,000.The company would record the extra $50,000 as:

A category of long-lived assets that are depleted over time is:

Your company rents computers to local businesses and schools.You have 1,000 computers with a book value of $160,000.As a result of changing technology,your computers are more difficult to rent so you must drastically reduce your rental price,which causes a decrease in estimated future cash flows.The fair value of the computers is estimated to be $125,000 because of their outdated technology.Your company should report an asset impairment loss of:

Depletion is different from depreciation and amortization in that depletion is:

Trademarks and goodwill are intangible assets that are not amortized.

Orangewood Industries bought a new cash register for $7,500.Orangewood originally planned to use the cash register for 4 years and then sell it for $600.After 4 years,Orangewood had recorded $6,900 of depreciation.If the company continues to use the cash register,still planning to sell it eventually for $600,then Orangewood should record:

The costs assigned to the individual assets acquired in a basket purchase are based on their relative:

Loma Linda,Inc.sells a long-lived asset that originally cost $400,000 for $100,000 on December 31,2018.The Accumulated Depreciation account had a balance of $220,000 after the current year's depreciation of $90,000 had been recorded.The company should recognize a:

Which of the following intangible assets has an unlimited life?