Quiz 10 - Accounting

A fixed asset's estimated value at the time it is to be retired from service is called a.market value b.carrying value c.book value d.residual value

.residual value

Weber Company purchased a mining site for $610,646 on July 1. The company expects to mine ore for the next 10 years and anticipates that a total of 98,227 tons will be recovered. The estimated residual value of the property is $54,435. During the first year, the company extracted 6,663 tons of ore. The depletion expense is a.$41,421.75 b.$54,435.00 c.$37,729.28 d.$55,621.10

41,421.75

Computer equipment was acquired at the beginning of the year at a cost of $74,600. It had an estimated residual value of $3,500 and an estimated useful life of five years. Determine the (a) depreciable cost, (b) straight-line rate, and (c) annual straight-line depreciation. a. Depreciable cost$ b. Straight-line rate% c. Annual straight-line depreciation

71100 20% 14220

On December 31, Strike Company has decided to discard one of its batting cages. The equipment had an initial cost of $215,700 and has accumulated depreciation of $194,130. Depreciation has been recorded up to the end of the year. Which of the following will be included in the entry to record the disposal? a.Equipment, credit, $215,700 b.Gain on Disposal of Asset, credit, $21,570 c.Loss on Disposal of Asset, debit, $194,130 d.Accumulated Depreciation, debit, $215,700

Equipment, credit, $215,700

If a fixed asset, such as a computer, were purchased on January 1 for $2,179 with an estimated life of 6 years and a salvage or residual value of $105, the journal entry for monthly expense under straight-line depreciation is a.Accumulated Depreciation345.67 Depreciation Expense345.67 b.Depreciation Expense345.67 Accumulated Depreciation345.67 c.Depreciation Expense28.81 Accumulated Depreciation28.81 d.Accumulated Depreciation28.81 Depreciation Expense28.81

If a fixed asset, such as a computer, were purchased on January 1 for $2,179 wi

On December 31, Strike Company sold one of its batting cages for $186,957. The equipment had an original cost of $219,950 and has accumulated depreciation of $32,993. Depreciation has been recorded up to the end of the year. What is the amount of the gain or loss on this transaction? a.no gain or loss b.loss of $(32,993) c.gain of $43,991 d.can't be determined with data provided

a.no gain or loss

The name, term, or symbol used to identify a business and its products is called a.a copyright b.a trademark c.a patent d.goodwill

b.a trademark

Which of the following is included in the cost of constructing a building? a.cost of paving the parking lot b.insurance costs during construction c.cost of removing the demolished building existing on the land when it was purchased d.cost of repairing vandalism damage during construction

b.insurance costs during construction

Machinery was purchased on January 1 for $78,890.00. The machinery has an estimated life of seven years and an estimated salvage value of $9,000. Double-declining-balance depreciation for the second year would be (round calculations to the nearest dollar): a.$17,100 b.$15,100 c.$16,100 d.$15,600

c.$16,100

When the amount of use of a fixed asset varies from year to year, the method of determining depreciation expense that best matches allocation of cost with revenue is a.the straight-line method b.MACRS c.the units-of-activity method d.the double-declining-balance method

c.the units-of-activity method

A new machine with a purchase price of $96,835, with transportation costs of $7,449, installation costs of $5,131, and special acquisition fees of $1,965, would have a cost basis of a.$96,835 b.$101,966 c.$103,931 d.$111,380

d.$111,380

Which of the following is true? a.If using the units-of-activity method, it is possible to depreciate more than the depreciable cost. b.If using the straight-line method, the amount of depreciation expense during the first year is higher than that of the double-declining-balance. c.If using the double-declining-balance method, the total amount of depreciation expense during the life of the asset will be the highest. d.Regardless of the depreciation method, the amount of total depreciation expense during the life of the asset will be the same.

d.Regardless of the depreciation method, the amount of total depreciation expense during the life of the asset will be the same.

Fixed assets are ordinarily presented on the balance sheet a.in a separate section along with intangible assets b.at current market values c.at replacement costs d.at cost less accumulated depreciation

d.at cost less accumulated depreciation

The depreciation method that does not use residual value in calculating the first year's depreciation expense is a.double-declining-balance b.units-of-activity c.sum-of-the-years-digits d.straight-line

double-declining-balance

Land acquired so it can be resold in the future is listed on the balance sheet as a(n) a.investment b.fixed asset c.intangible asset d.current asset

investment

All of the following are needed for the calculation of straight-line depreciation except a.units produced b.residual value c.estimated life d.cost

units produced

A characteristic of a fixed asset is that it is a.intangible b.held for sale in the ordinary course of the business c.a short-term investment d.used in the operations of a business

used in the operations of a business