Accounting ch. 18 quiz

Assets such as patents, copyrights, and trademarks are tangible assets.

False

If there is an improvement to a building that extends the life of the building, the total cost incurred should be debited to the long-term asset.

False

Furniture and equipment are examples are tangible assets.

True

The allocation of the cost of a plant asset over the periods expected to benefit from its use is called depreciation.

True

The cost of planting trees and shrubs, installing fences, and paving parking areas are normally charged to the land improvements account and are later depreciated over their expected useful lives.

True

The depreciation method in which the depreciable cost of an asset is apportioned equally over its estimated useful life in terms of months or years is called the sum-of-the-years'-digits method.

True

The depreciation method that estimates the number of units of service or output that can be provided by an asset and allocates the depreciable cost of the asset on the basis of the use or output during each period is called the units-of-output or units-of-production method

True

The difference between the cost of an asset and its accumulated depreciation is its book value.

True

The recognition of depreciation is not intended to make the assets reflect their market value on the balance sheet.

True

The write-off of the cost of an intangible long-term asset is called amortization.

True