Question 1

Neither land nor land improvements are depreciated.

Accepted Answer

A) True 
 B)False  False

Question 2

Juarez Mining purchased a vein of coal ore for $3,800,000. It is estimated that 30,000,000 tons of ore are available to be extracted. The estimated depletion rate for each ton of ore (rounded to the nearest cent)is:

Accepted Answer

A) $1.30. 
B) $0.13. 
C) $0.12. 
D) $0.14. 
A) $1.30. 
B) $0.13. 
C) $0.12. 
D) $0.14. B

Question 3

Which of the following marketable securities are reported at cost on the Balance Sheet date?

Accepted Answer

A) Trading securities 
B) Available-for sale securities 
C) Held-to-maturity securities 
D) Trading and held-to-maturity securities 
A) Trading securities 
B) Available-for sale securities 
C) Held-to-maturity securities 
D) Trading and held-to-maturity securities C

Question 4

The Miami Dolphins and New York Yankees are examples of:

Accepted Answer

A) copyrighted teams. 
B) trademarked teams. 
C) franchised teams. 
D) patented teams. 
A) copyrighted teams. 
B) trademarked teams. 
C) franchised teams. 
D) patented teams.

Question 5

A fixed asset's useful life may be shorter than its physical life due to obsolescence.

Accepted Answer

A) True 
 B)False

Question 6

If an extraordinary repair is incorrectly expensed in the current period, the net income for that period will be:

Accepted Answer

A) overstated and net income in future periods will not be affected. 
B) understated and net income in future periods will not be affected. 
C) overstated and net income in future periods will be understated. 
D) understated and net income in future periods will be overstated. 
A) overstated and net income in future periods will not be affected. 
B) understated and net income in future periods will not be affected. 
C) overstated and net income in future periods will be understated. 
D) understated and net income in future periods will be overstated.

Question 7

Research and development costs (R&D)are generally:

Accepted Answer

A) expensed and become part of the Income Statement. 
B) listed as "other intangibles" on the Balance Sheet. 
C) listed as "current assets" on the Balance Sheet. 
D) listed as "long-term assets" on the Balance Sheet. 
A) expensed and become part of the Income Statement. 
B) listed as "other intangibles" on the Balance Sheet. 
C) listed as "current assets" on the Balance Sheet. 
D) listed as "long-term assets" on the Balance Sheet.

Question 8

Patents, copyrights, and trademarks are:

Accepted Answer

A) amortized. 
B) depleted. 
C) depreciated. 
D) expensed. 
A) amortized. 
B) depleted. 
C) depreciated. 
D) expensed.

Question 9

Custom Closets purchased office fixtures on January 1. The cost was $16,000, and the fixtures had a residual value of $6,000. The fixtures were given a useful life of 8 years. After the end of three years, it was determined that the fixtures would be obsolete in 2 more years and their residual value would still be $6,000. What will be the depreciation under the straight-line method to the nearest dollar be for the fourth year? (Round your final answer to the nearest dollar.)

Accepted Answer

A) $1,250 
B) $2,000 
C) $3,125 
D) $3,750 
A) $1,250 
B) $2,000 
C) $3,125 
D) $3,750

Question 10

Equipment, buildings, and vehicles are:

Accepted Answer

A) amortized. 
B) depleted. 
C) depreciated. 
D) expensed. 
A) amortized. 
B) depleted. 
C) depreciated. 
D) expensed.

Question 11

The slogan "Can you hear me now?" for Verizon is a protected slogan called a:

Accepted Answer

A) patent. 
B) copyright. 
C) trademark. 
D) brand name. 
A) patent. 
B) copyright. 
C) trademark. 
D) brand name.

Question 12

A patent is the exclusive right to reproduce and sell a book, musical composition, or film.

Accepted Answer

A) True 
 B)False

Question 13

Subtracting accumulated depletion from the asset account coal mine would yield the:

Accepted Answer

A) current market value of the coal mine. 
B) original cost of the coal mine. 
C) net book value of the coal mine. 
D) current period's depletion expense for the coal mine. 
A) current market value of the coal mine. 
B) original cost of the coal mine. 
C) net book value of the coal mine. 
D) current period's depletion expense for the coal mine.

Question 14

If the amount harvested in a timber operation was different every year for four years, you would:

Accepted Answer

A) recompute the depletion expense rate per unit each year. 
B) use the same depletion expense rate per unit each year. 
C) debit Depletion Expense for the same amount each year. 
D) credit Accumulated Depletion-timber for the same amount each year. 
A) recompute the depletion expense rate per unit each year. 
B) use the same depletion expense rate per unit each year. 
C) debit Depletion Expense for the same amount each year. 
D) credit Accumulated Depletion-timber for the same amount each year.

Question 15

Caesar Company acquired Illusions, Inc. three years ago, and the purchase included $75,000 of goodwill. Illusion's goodwill now has a fair value of $60,000 - how would Caesar account for this difference?

Accepted Answer

A) Goodwill is amortized - usually on a straight line basis, so the annual amortization will be adjusted. 
B) A journal entry will be made - debiting Loss on Impairment of Goodwill for $15,000 and crediting Goodwill for $15,000. 
C) The difference will be written off using an allowance account. 
D) The account Goodwill will be debited for $15,000 and Loss on Goodwill will be credited for $15,000. 
A) Goodwill is amortized - usually on a straight line basis, so the annual amortization will be adjusted. 
B) A journal entry will be made - debiting Loss on Impairment of Goodwill for $15,000 and crediting Goodwill for $15,000. 
C) The difference will be written off using an allowance account. 
D) The account Goodwill will be debited for $15,000 and Loss on Goodwill will be credited for $15,000.

Question 16

Whether a building is purchased or constructed, the same items are used to compute the price of the building.

Accepted Answer

A) True 
 B)False

Question 17

A company replaced an engine on a vehicle and debited the amount to Repairs and Maintenance expense, rather than debiting the Vehicle account. Which of the following would occur because of this error?

Accepted Answer

A) Repairs expense would be understated. 
B) Net income would be overstated. 
C) Assets would be overstated. 
D) Assets would be understated. 
A) Repairs expense would be understated. 
B) Net income would be overstated. 
C) Assets would be overstated. 
D) Assets would be understated.

Question 18

Which intangible asset is recorded only when an acquiring company purchases another company?

Accepted Answer

A) Franchise 
B) Goodwill 
C) Brand name 
D) Trademark 
A) Franchise 
B) Goodwill 
C) Brand name 
D) Trademark

Question 19

The journal entry to record depletion includes a credit to Accumulated Depletion.

Accepted Answer

A) True 
 B)False

Question 20

According to GAAP, goodwill is:

Accepted Answer

A) amortized every year. 
B) recorded as a gain only when the goodwill is gaining value. 
C) recorded as a loss only when the goodwill is losing value. 
D) amortized like other intangible assets. 
A) amortized every year. 
B) recorded as a gain only when the goodwill is gaining value. 
C) recorded as a loss only when the goodwill is losing value. 
D) amortized like other intangible assets.

Neither land nor land improvements are depreciated.

Juarez Mining purchased a vein of coal ore for $3,800,000. It is estimated that 30,000,000 tons of ore are available to be extracted. The estimated depletion rate for each ton of ore (rounded to the nearest cent)is:

Which of the following marketable securities are reported at cost on the Balance Sheet date?

The Miami Dolphins and New York Yankees are examples of:

A fixed asset's useful life may be shorter than its physical life due to obsolescence.

If an extraordinary repair is incorrectly expensed in the current period, the net income for that period will be:

Research and development costs (R&D)are generally:

Patents, copyrights, and trademarks are:

Equipment, buildings, and vehicles are:

The slogan "Can you hear me now?" for Verizon is a protected slogan called a:

A patent is the exclusive right to reproduce and sell a book, musical composition, or film.

Subtracting accumulated depletion from the asset account coal mine would yield the:

If the amount harvested in a timber operation was different every year for four years, you would:

Caesar Company acquired Illusions, Inc. three years ago, and the purchase included $75,000 of goodwill. Illusion's goodwill now has a fair value of $60,000 - how would Caesar account for this difference?

Whether a building is purchased or constructed, the same items are used to compute the price of the building.

A company replaced an engine on a vehicle and debited the amount to Repairs and Maintenance expense, rather than debiting the Vehicle account. Which of the following would occur because of this error?

Which intangible asset is recorded only when an acquiring company purchases another company?

The journal entry to record depletion includes a credit to Accumulated Depletion.

According to GAAP, goodwill is:

Business, Accounting, and You

Analyzing and Recording Business Transactions

Adjusting and Closing Entries

Accounting for a Merchandising Business

Inventory

The Challenges of Accounting: Standards, Internal Control, Audits, Fraud, and Ethics

Cash and Receivables

Current Liabilities and Long-Term Debt

Corporations: Paid-In Capital and Retained Earnings

The Statement of Cash Flows

Financial Statement Analysis

Filters

Exam 8: Long-Term and Other Assets

Neither land nor land improvements are depreciated.

Juarez Mining purchased a vein of coal ore for $3,800,000. It is estimated that 30,000,000 tons of ore are available to be extracted. The estimated depletion rate for each ton of ore (rounded to the nearest cent)is:

Which of the following marketable securities are reported at cost on the Balance Sheet date?

The Miami Dolphins and New York Yankees are examples of:

A fixed asset's useful life may be shorter than its physical life due to obsolescence.

If an extraordinary repair is incorrectly expensed in the current period, the net income for that period will be:

Research and development costs (R&D)are generally:

Patents, copyrights, and trademarks are:

Equipment, buildings, and vehicles are:

The slogan "Can you hear me now?" for Verizon is a protected slogan called a:

A patent is the exclusive right to reproduce and sell a book, musical composition, or film.

Subtracting accumulated depletion from the asset account coal mine would yield the:

If the amount harvested in a timber operation was different every year for four years, you would:

Caesar Company acquired Illusions, Inc. three years ago, and the purchase included $75,000 of goodwill. Illusion's goodwill now has a fair value of $60,000 - how would Caesar account for this difference?

Whether a building is purchased or constructed, the same items are used to compute the price of the building.

A company replaced an engine on a vehicle and debited the amount to Repairs and Maintenance expense, rather than debiting the Vehicle account. Which of the following would occur because of this error?

Which intangible asset is recorded only when an acquiring company purchases another company?

The journal entry to record depletion includes a credit to Accumulated Depletion.

According to GAAP, goodwill is:

Business, Accounting, and You

Analyzing and Recording Business Transactions

Adjusting and Closing Entries

Accounting for a Merchandising Business

Inventory

The Challenges of Accounting: Standards, Internal Control, Audits, Fraud, and Ethics

Cash and Receivables

Current Liabilities and Long-Term Debt

Corporations: Paid-In Capital and Retained Earnings

The Statement of Cash Flows

Financial Statement Analysis

Filters