... useful life?
Google - Which of the following assets does not decline in service potential over the course of its?
- 3+ months ago by lydia4372
- life, fixture, over, course, land, equipment, service, google, services
... useful life?
Added 3+ months ago:
1. Which of the following assets does not decline in service potential over the course of its useful life?
2. Carey Company buys land for $50,000 on 12/31/09. As of 3/31/10, the land has appreciated in value to $50,700. On 12/31/10, the land has an appraised value of $51,800. By what amount should the Land account be increased in 2010?
3. Engler Company purchases a new delivery truck for $45,000. The sales taxes are $3,000. The logo of the company is painted on the side of the truck for $1,200. The truck license is $120. The truck undergoes safety testing for $220. What does Engler record as the cost of the new truck?
4. The balance in the Accumulated Depreciation account represents the
a. cash fund to be used to replace plant assets.
b. amount to be deducted from the cost of the plant asset to arrive at its fair market value.
c. amount charged to expense in the current period.
d. amount charged to expense since the acquisition of the plant asset.
5. Depreciation is the process of allocating the cost of a plant asset over its service life in
a. an equal and equitable manner.
b. an accelerated and accurate manner.
c. a systematic and rational manner.
d. a conservative market-based manner.
6. Recording depreciation each period is necessary in accordance with the
a. going concern principle.
b. cost principle.
c. matching principle.
d. asset valuation principle.
7. Equipment was purchased for $75,000. Freight charges amounted to $3,500 and there was a cost of $10,000 for building a foundation and installing the equipment. It is estimated that the equipment will have a $15,000 salvage value at the end of its 5-year useful life. Depreciation expense each year using the straight-line method will be
8. A company purchased factory equipment for $250,000. It is estimated that the equipment will have a $25,000 salvage value at the end of its estimated 5-year useful life. If the company uses the double-declining-balance method of depreciation, the amount of annual depreciation recorded for the second year after purchase would be
9. A factory machine was purchased for $75,000 on January 1, 2010. It was estimated that it would have a $15,000 salvage value at the end of its 5-year useful life. It was also estimated that the machine would be run 40,000 hours in the 5 years. The company ran the machine for 4,000 actual hours in 2010. If the company uses the units-of-activity method of depreciation, the amount of depreciation expense for 2010 would be
10. Grimwood Trucking purchased a tractor trailer for $98,000. Interline uses the units-of-activity method for depreciating its trucks and expects to drive the truck 1,000,000 miles over its 12-year useful life. Salvage value is estimated to be $14,000. If the truck is driven 90,000 miles in its first year, how much depreciation expense should Grimwood record?
11. On May 1, 2010, Pinkley Company sells office furniture for $90,000 cash. The office furniture originally cost $225,000 when purchased on January 1, 2003. Depreciation is recorded by the straight-line method over 10 years with a salvage value of $22,500. What depreciation expense should be recorded on this asset in 2010?
12. Costs incurred to increase the operating efficiency or useful life of a plant asset are referred to as
a. capital expenditures.
b. expense expenditures.
c. ordinary repairs.
d. revenue expenditures.
13. A company sells a plant asset which originally cost $180,000 for $60,000 on December 31, 2010. The Accumulated Depreciation account had a balance of $72,000 after the current year's depreciation of $18,000 had been recorded. The company should recognize a
a. $120,000 loss on disposal.
b. $48,000 gain on disposal.
c. $48,000 loss on disposal.
d. $30,000 loss on disposal.
14. If a fully depreciated plant asset is still used by a company, the
a. estimated remaining useful life must be revised to calculate the correct revised depreciation.
b. asset is removed from the books.
c. accumulated depreciation account is removed from the books but the asset account remains.
d. asset and the accumulated depreciation continue to be reported on the balance sheet without adjustment until the asset is retired.
15. The entry to record patent amortization usually includes a credit to
a. Amortization Expense.
b. Accumulated Amortization.
c. Accumulated Depreciation.
16. The cost of successfully defending a patent in an infringement suit should be
a. charged to Legal Expenses.
b. deducted from the book value of the patent.
c. added to the cost of the patent.
d. recognized as a loss in the current period.
17. An asset that cannot be sold individually in the market place is
a. a patent.
c. a copyright.
d. a trade name.
18. If a company incurs legal costs in successfully defending its patent, these costs are recorded by debiting
a. Legal Expense.
b. an Intangible Loss account.
c. the Patent account.
d. a revenue expenditure account.
19. Given the following account balances at year end, compute the total intangible assets on the balance sheet of Kepler Enterprises.
Accounts Receivable 4,000,000
Research & Development Costs 2,000,000
20. A company has the following assets:
Buildings and Equipment, less accumulated depreciation of $2,000,000 $9,600,000
Timberlands, less accumulated depletion of $2,800,000 4,800,000
The total amount reported under Property, Plant, and Equipment would be
21.Most companies pay current liabilities
a. out of current assets.
b. by issuing interest-bearing notes payable.
c. by issuing stock.
d. by creating long-term liabilities.
22. A current liability is a debt that can reasonably be expected to be paid
a. within one year.
b. between 6 months and 18 months.
c. out of currently recognized revenues.
d. out of cash currently on hand.
23. The relationship of current assets to current liabilities is used in evaluating a company's
a. operating cycle.
b. revenue-producing ability.
c. short-term debt paying ability.
d. long-range solvency.
24. The entry to record the proceeds upon issuing an interest-bearing note is
a. Interest Expense
c. Notes Payable
25. Admire County Bank agrees to lend Givens Brick Company $200,000 on January 1. Givens
Brick Company signs a $200,000, 8%, 9-month note. The entry made by Givens Brick Company
on January 1 to record the proceeds and issuance of the note is
a. Interest Expense 12,000
Notes Payable 200,000
b. Cash 200,000
Notes Payable 200,000
c. Cash 200,000
Interest Expense 12,000
Notes Payable 212,000
d. Cash 200,000
Interest Expense 12,000
Notes Payable 200,000
Interest Payable 12,000
26. Sales taxes collected by a retailer are recorded by
a. crediting Sales Taxes Revenue.
b. debiting Sales Taxes Expense.
c. crediting Sales Taxes Payable.
d. debiting Sales Taxes Payable.
27.The interest charged on a $100,000 note payable, at the rate of 6%, on a 60-day note would be
28. The interest charged on a $50,000 note payable, at the rate of 8%, on a 3-month note would be
29. A company receives $174, of which $14 is for sales tax. The journal entry to record the sale would include a
a debit to Sales Tax Expense for $14.
b. debit to Sales Tax Payable for $14.
c. debit to Sales for $174.
d. debit to Cash for $174.
30. Layton Company does not ring up sales taxes separately on the cash register. Total receipts for October amounted to $18,900. If the sales tax rate is 5%, what amount must be remitted to the state for October's sales taxes?
d. It cannot be determined.
31. A cash register tape shows cash sales of $1,500 and sales taxes of $90. The journal entry to record this information is
a. Cash 1,500
b. Cash 1,590
Sales Tax Revenue 90
c. Cash 1,500
Sales Tax Expense 90
d. Cash 1,590
Sales Taxes Payable 90
32. A contingent liability need only be disclosed in the financial statement notes when the likelihood of the contingency is
a. reasonably possible.
33.The total compensation earned by an employee is called
a. take-home pay.
b. net pay.
c. net earnings.
d. gross earnings.
34.Which one of the following payroll taxes does not result in a payroll tax expense for the employer?
a. FICA tax
b. Federal income tax
c. Federal unemployment tax
d. State unemployment tax
35. The following totals for the month of April were taken from the payroll register of Kirk Company.
FICA taxes withheld 1,100
Income taxes withheld 5,000
Medical insurance deductions 900
Federal unemployment taxes 64
State unemployment taxes 432
The journal entry to record the monthly payroll on April 30 would include a
a. debit to Salaries Expense for $24,000.
b. credit to Salaries Payable for $24,000.
c. debit to Salaries Payable for $24,000.
d. debit to Salaries Expense for $17,000.
36. Julie Norman, earns $20 per hour for a 40 hour work week and $30 per hour for overtime work. If Julie works 44 hours, her gross earnings are:
37. Gary Dittman, an employee of Hopkins Company, has gross earnings for the month of October of $8,000. FICA taxes are 8% of gross earnings, federal income taxes amount to $1,270 for the month, state income taxes are 2% of gross earnings, and authorizes voluntary deductions of $20 per month to the United Way. What is the net pay for Gary?
38. Assuming a FICA tax rate of 8% on the first $100,000 in wages, and a federal income tax rate of 20% on all wages, what would be an employee's net pay for the year if he earned $110,000 for the year?
39. The current ratio is
a. current assets plus current liabilities.
b. current assets minus current liabilities.
c. current assets divided by current liabilities.
d. current assets multiplied by current liabilities.
40. Sales taxes collected by a retailer are reported as
a. contingent liabilities.
d. current liabilities.
41. The current portion of long-term debt should
a. be paid immediately.
b. be reclassified as a current liability.
c. be classified as a long-term liability.
d. not be separated from the long-term portion of debt.
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