Question 1

Net income is affected by the depreciation method used.

Accepted Answer

A) True 
 B)False

Question 2

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).
-$\begin{array} { | l | l | l | l | l | } 
\hline & \text { Column 1 } & \text { Column 2 } & \text { Column 3 } & \text { Column } 4 \
\hline \text { Coal deposit } & & & & \
\hline
\end{array}$

Accepted Answer

The answer of For each of the following, identify in...

Question 3

On January 1,200x,Mayberry Company bought a patent for $20,000.Its estimated useful life is five years.Record the amortization for the first two years.

Accepted Answer

Year 1 @#IMG-DLM&_TB

Question 4

The three categories of writing off plant assets,natural resources,and intangible assets are ________,________,and ________.

Accepted Answer

Depreciati

Question 5

When an asset is exchanged for a similar asset and a gain results,under accounting rules the gain is:

Accepted Answer

A) credited to Gain on Exchange of an Asset. 
B) recorded in the other income section of the income statement. 
C) absorbed into the cost of the new asset. 
D) subtracted from the cost of the new asset. 
A) credited to Gain on Exchange of an Asset. 
B) recorded in the other income section of the income statement. 
C) absorbed into the cost of the new asset. 
D) subtracted from the cost of the new asset.

Question 6

To record the depletion of natural resources,the most common method is to use units-of -production in determining the amount of depletion.

Accepted Answer

A) True 
 B)False

Question 7

A loss on disposal of an asset is listed as:

Accepted Answer

A) a liability on the balance sheet. 
B) an asset on the balance sheet. 
C) other expense on the income statement. 
D) other income on the income statement. 
A) a liability on the balance sheet. 
B) an asset on the balance sheet. 
C) other expense on the income statement. 
D) other income on the income statement.

Question 8

A purchase of land and buildings would require the use of only one asset account,Land and Buildings.

Accepted Answer

A) True 
 B)False

Question 9

A company expanded its manufacturing facility by adding an additional 15,000 square feet to the building.This is an example of a(n):

Accepted Answer

A) addition. 
B) betterment. 
C) extraordinary repair 
D) revenue expenditure. 
A) addition. 
B) betterment. 
C) extraordinary repair 
D) revenue expenditure.

Question 10

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).
-$\begin{array} { | l | l | l | l | l | } 
\hline & \text { Column 1 } & \text { Column 2 } & \text { Column 3 } & \text { Column 4 } \
\hline \text { Goodwill } & & & & \
\hline
\end{array}$

Accepted Answer

The answer of For each of the following, identify in...

Question 11

Copyright protection expires upon the author's death.

Accepted Answer

A) True 
 B)False

Question 12

Which depreciation method does not deduct residual value when computing depreciation expense?

Accepted Answer

A) Units-of-production 
B) Straight-line 
C) Double-declining-balance 
D) Both A and B are correct. 
A) Units-of-production 
B) Straight-line 
C) Double-declining-balance 
D) Both A and B are correct.

Question 13

When selling a plant asset,the gain was not recorded,but pocketed.This error would cause:

Accepted Answer

A) the period's net income to be understated. 
B) the period's net income to be overstated. 
C) the period end assets to be overstated. 
D) None of these are correct. 
A) the period's net income to be understated. 
B) the period's net income to be overstated. 
C) the period end assets to be overstated. 
D) None of these are correct.

Question 14

The depreciation method that does not base the expense on the passage of time but on the level of use is:

Accepted Answer

A) units-of-production. 
B) straight-line. 
C) modified accelerated cost recovery. 
D) double-declining-balance. 
A) units-of-production. 
B) straight-line. 
C) modified accelerated cost recovery. 
D) double-declining-balance.

Question 15

Gains incurred in selling or trading assets are always recognized.

Accepted Answer

A) True 
 B)False

Question 16

If an asset is exchanged for a similar asset,a loss results:

Accepted Answer

A) when the book value of the old asset is greater than what is received for the trade-in allowance. 
B) when the book value of the old asset is less than what is received for the trade-in allowance. 
C) when the accumulated depreciation equals the cost of the old asset. 
D) None of these answers are correct. 
A) when the book value of the old asset is greater than what is received for the trade-in allowance. 
B) when the book value of the old asset is less than what is received for the trade-in allowance. 
C) when the accumulated depreciation equals the cost of the old asset. 
D) None of these answers are correct.

Question 17

The Cutcut Mower Service owned a truck with an original cost of $70,000 on which there is accumulated depreciation of $60,000.The truck is exchanged for a new truck priced at $100,000 with a trade-in allowance of $16,000 and the balance in cash.
a.The book value of the old truck is ________.
b.The gain on the exchange is ________.
c.The cost basis in the new truck,assuming accounting rules is ________.

Accepted Answer

a.$10,000

Question 18

What would the depreciation expense be in year 3 for a computer system using the straight-line method when cost is $5,000,residual value is $1,000,and the expected life is 4 years?

Accepted Answer

A) $2,000 
B) $1,500 
C) $1,250 
D) $1,000 
A) $2,000 
B) $1,500 
C) $1,250 
D) $1,000

Question 19

Using MACRS rates for a 3,5,7,and 10-year property,what is the percentage for the depreciable rate?

Accepted Answer

A) 200 percent 
B) 150 percent 
C) 125 percent 
D) 100 percent 
A) 200 percent 
B) 150 percent 
C) 125 percent 
D) 100 percent

Question 20

Accumulated depletion should be reported as a(an)________ on the income statement.

Accepted Answer

The answer of Accumulated depletion should be reported as a(an)________...

Exam 16: Accounting for Property, plant, equipment, and Intangible Assets

Net income is affected by the depreciation method used.

On January 1,200x,Mayberry Company bought a patent for $20,000.Its estimated useful life is five years.Record the amortization for the first two years.

The three categories of writing off plant assets,natural resources,and intangible assets are ________,________,and ________.

When an asset is exchanged for a similar asset and a gain results,under accounting rules the gain is:

To record the depletion of natural resources,the most common method is to use units-of -production in determining the amount of depletion.

A loss on disposal of an asset is listed as:

A purchase of land and buildings would require the use of only one asset account,Land and Buildings.

A company expanded its manufacturing facility by adding an additional 15,000 square feet to the building.This is an example of a(n):

Copyright protection expires upon the author's death.

Which depreciation method does not deduct residual value when computing depreciation expense?

When selling a plant asset,the gain was not recorded,but pocketed.This error would cause:

The depreciation method that does not base the expense on the passage of time but on the level of use is:

Gains incurred in selling or trading assets are always recognized.

If an asset is exchanged for a similar asset,a loss results:

What would the depreciation expense be in year 3 for a computer system using the straight-line method when cost is $5,000,residual value is $1,000,and the expected life is 4 years?

Using MACRS rates for a 3,5,7,and 10-year property,what is the percentage for the depreciable rate?

Accumulated depletion should be reported as a(an)________ on the income statement.

Accounting Concepts and Procedures

Debits and Credits: Analyzing and Recording Business Transactions

Beginning the Accounting Cycle

The Accounting Cycle Continued

The Accounting Cycle Completed

Banking Procedure and Control of Cash

Calculating Pay and Payroll Taxes: The Beginning of the Payroll Process

Paying,recording,and Reporting Payroll and Payroll Taxes: The Conclusion of the Payroll Process

Sales and Cash Receipts

Purchases and Cash Payments

Preparing a Worksheet for a Merchandise Company

Completion of the Accounting Cycle for a Merchandise Company

Accounting for Bad Debts

Notes Receivable and Notes Payable

Accounting for Merchandise Inventory

Partnership

Corporations: Organizations and Stock

Corporations: Stock Values, dividends, treasury Stocks, and Retained Earnings

Corporations and Bonds Payable

Statement of Cash Flows

Analyzing Financial Statements

The Voucher System

Departmental Accounting

Manufacturing Accounting

Filters

The three categories of writing off plant assets,natural resources,and intangible assets are ,,and .