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

Talarico's Subs purchased a new van for $25,000,its estimated useful life at 100,000 miles,residual value of $5,000.The van was driven 15,000 miles in year 1.What is the depreciation expense in year 1?

A truck that cost $26,000 has been owned for 3 years and is traded for another truck for the same purpose.Total accumulated depreciation at the time of trade is $15,600.The trade-in value of the old truck is $12,000 and the new truck has a fair market value of $30,000,the new truck would be recorded at:

What would be the depreciation expense in year 1,using units-of-production,for a molding machine that cost $18,000,had a useful life of 3 years,and an estimated total machine hours of 36,000? The salvage value is $3,000 and production in year 1 was 10,000 hours.

Patents,copyrights,and franchises are intangible assets with the same number of years of useful life.

When calculating declining balance depreciation,the straight-line rate was used instead of double the straight-line rate.In the first year of ownership,this error would cause:

If an asset is being sold or exchanged,the gain or loss is always computed by comparing the:

A task station that originally cost $2,500 has no estimated salvage value and was depreciated at the rate of 20% per year (straight-line depreciation).At the end of the third year,it was sold for $1,500 cash.The transaction would result in a:

Land Improvements is an asset account that records improvements to land that have an unlimited life.

Which of the following is a non-depreciable asset?

If there are repairs needed in the process of installation,this should be charged to the cost of the machine.

The entry to record the purchase of a machine on account that costs $20,000,set-up fees,$1,000,and freight,$500,would be:

The depreciation method which charges more expense in earlier years than in later years is the:

Define and compare capital expenditures and revenue expenditures.

Straight-line depreciation is used in the first year when double-declining-balance should be used.This error would cause:

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

A car is purchased for $25,000 on January 1.It has a 4-year life and a salvage value of $1,000.Compute the annual depreciation expense using the double-declining-balance method for all 4 years.

A plant asset is fully depreciated when the book value is:

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:

A capital expenditure is recorded in an asset account.

A computer server system,which had cost $210,000 and had accumulated depreciation of $147,000,was traded for a new system with a fair market value of $235,000.The old system and cash of $180,000 were given for the new system.Prepare the journal entry for the exchange of these similar assets.