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Match the Cash Expenditures Given Below with the Appropriate Accounting

Question 158

Matching

Match the cash expenditures given below with the appropriate accounting treatment.
(Note: An individual classification may be used more than once, or not at all.)

Premises:

Responses:

Acquired a piece of machinery for plant operations

Record the expenditure as an asset and depreciate it.

Purchased a producing copper mine

Record the expenditure as an asset and amortize it.

Paid property taxes owed on land acquired

Record the expenditure as an asset and deplete it.

Paid for an oil change to a vehicle

Record the expenditure as an asset but do not systematically allocate it to expense.

Purchased a copyright from an author

Record the expenditure as an expense in the current period.

None of the above is appropriate.

Premises:

Acquired a piece of machinery for plant operations

Purchased a producing copper mine

Paid property taxes owed on land acquired

Paid for an oil change to a vehicle

Purchased a copyright from an author

Responses:

Record the expenditure as an asset and depreciate it.

Record the expenditure as an asset and amortize it.

Record the expenditure as an asset and deplete it.

Record the expenditure as an asset but do not systematically allocate it to expense.

Record the expenditure as an expense in the current period.

None of the above is appropriate.

Correct Answer:

Premises:

Responses:

Record the expenditure as an asset and depreciate it.

Record the expenditure as an asset and amortize it.

Record the expenditure as an asset and deplete it.

Record the expenditure as an asset but do not systematically allocate it to expense.

Record the expenditure as an expense in the current period.

None of the above is appropriate.