Statement I: Non-current assets (or long-term assets) can consist of both depreciable and non-depreciable assets. Statement...
Statement I:
Non-current assets (or long-term assets) can consist of both depreciable and non-depreciable assets.
Statement II:
Depreciation is the allocation process of the cost of an asset (property or equipment) to expense over its useful life, in a rational and systematic way.
| Both statements are incorrect |
| Both statements are correct |
| Statement 1 is correct; statement 2 is incorrect |
| Statement 1 is incorrect; statement 2 is correct |
Homework Answers
| Both statements are correct, Non-current assets (or long-term assets) can consist of both depreciable and non-depreciable assets, Depreciation is the allocation process of the cost of an asset (property or equipment) to expense over its useful life, in a rational and systematic way. | ||||||||||||||||||||||||||
Add Answer to:
Statement I:
Non-current assets (or long-term assets) can consist of both
depreciable and non-depreciable assets.
Statement...
Non-current assets are any liabilities that are used in the operations of a business. TRUE:☐ FALSE:☐ 2....
Non-current assets are any liabilities that are used in the operations of a business. TRUE:☐ FALSE:☐ 2. The cost of an asset includes all normal and reasonable expenditures necessary to get it in place and ready for its intended use. TRUE:☐ FALSE:☐ 3. Depreciation is the process of allocating the cost of a tangible asset in a rational and systematic manner over the asset's estimated useful life. TRUE:☐ FALSE:☐ 4. Residual value is an estimate of an asset's value at the end of...
29. Losses on the sale of long-term assets for cash: A. Are the excess of the...
29. Losses on the sale of long-term assets for cash: A. Are the excess of the book value over the cash received B. Are recorded as a credit. C. Are reported on a net-of-tax basis if material. D. Are the excess of the cash received over the book value. 30. Which of the following best describes the objective of depreciation? A. To allocate the cost of a long-term asset to an expense over its service life. B. To estimate the...
Entries for Sale of Long-term or relatively permanent tangible assets such as equipment, machinery, and buildings...
Entries for Sale of Long-term or relatively permanent tangible assets such as equipment, machinery, and buildings that are used in the normal business operations and that depreciate over time.Fixed Asset Equipment acquired on January 8 at a cost of $156,950, has an estimated useful life of 15 years, has an estimated The estimated value of a fixed asset at the end of its useful life.residual value of $9,050, and is depreciated by the A method of depreciation that provides for...
16. Depr.reciation of long-term assets may be described best as the: Cash payments made during the...
16. Depr.reciation of long-term assets may be described best as the: Cash payments made during the period on loans used to finance the purchase of assets such as buildings and equipment, Cash being set aside each period to provide for the replacement of long-lived assets, such as buildings and equipment Decline in the market value of an asset during the period. Systematic allocation of the cost of long-lived assets to expense. None of the above. Use the following data for...
Match the statement with the term most directly associated with it. Rights, privileges, and competitive advantages...
Match the statement with the term most directly associated with it. Rights, privileges, and competitive advantages that result from the ownership of long- lived assets that do not possess physical substance. The allocation of the cost of an intangible asset to expense in a rational and systematic manner. Aright to sell certain products or services, or use certain trademarks or trade names within a designated geographic area. Costs incurred by a company that often lead to patents or new products....
1) Which statement relating to revaluations of non-current assets is not true? Select one: a. A...
1) Which statement relating to revaluations of non-current assets is not true? Select one: a. A revaluation increase is regarded as income to be added to the firm's profit for the year. b. A revaluation decrease should be included as a reduction in profit. c. Before assets are revalued any existing accumulated depreciation must be written off against the asset account. d. Future depreciation charges will be based on the revalued carrying amount of the asset. 2) Which is the...
Question text Preparing the [I] consolidation journal entries for sale of depreciable assets - Equity method...
Question text
Preparing the
[I] consolidation journal entries for sale of depreciable
assets - Equity method
Assume that on January 1, 2011, a wholly owned subsidiary sells to
its parent, for a sale price of $132,000, equipment that originally
cost $156,000. The subsidiary originally purchased the equipment on
January 1, 2007, and depreciated the equipment assuming a 10-year
useful life (straight-line with no salvage value). The parent has
adopted the subsidiary's depreciation policy and depreciates the
equipment over the remaining...
Chapter 8: Accounting for Long-Term Operational Assets Basket Purchase Allocation, Depreciation, Gain Loss on Sale. Bishop...
Chapter 8: Accounting for Long-Term Operational Assets Basket Purchase Allocation, Depreciation, Gain Loss on Sale. Bishop Enterprises purchased land, a building, and some equipment on January 1, 2018 for $400,000. An appraiser valued the land at $50,000, the building at $350,000, and the equipment at $100,000. The building has a useful life of 20 years and the company expects the residual value to be $30,000. The equipment has a useful life of 5 years with an expected residual value of...
Assume that one of the fixed assets listed in Apple’s 2017 balance sheet will be disposed...
Assume that one of the fixed assets listed in Apple’s 2017 balance
sheet will be disposed of. Please provide the journal entry for the
disposition of that asset. (You may have to look in the notes to
the financial statements to see what the amount of accumulated
depreciation is.) Next, assume that the company will sell the fixed
asset for a gain of $20,000. Please provide the journal entry for
the sale of that asset at a $20,000 gain.
Note...
When a company invests in a long-lived asset (a Long Term asset) it creates an accounting...
When a company invests in a long-lived asset (a Long Term asset) it creates an accounting problem: if the asset had a limited useful life, then at some point it will have a value of zero (or close to zero). The day we purchase the asset it has a high value, and someday it will have a minimal value- how to appropriately allocate the expense of the asset as er gradually reduce the value of the asset on the Balance...
29. Losses on the sale of long-term assets for cash: A. Are the excess of the book value over the cash received B. Are recorded as a credit. C. Are reported on a net-of-tax basis if material. D. Are the excess of the cash received over the book value. 30. Which of the following best describes the objective of depreciation? A. To allocate the cost of a long-term asset to an expense over its service life. B. To estimate the...
16. Depr.reciation of long-term assets may be described best as the: Cash payments made during the period on loans used to finance the purchase of assets such as buildings and equipment, Cash being set aside each period to provide for the replacement of long-lived assets, such as buildings and equipment Decline in the market value of an asset during the period. Systematic allocation of the cost of long-lived assets to expense. None of the above. Use the following data for...
Match the statement with the term most directly associated with it. Rights, privileges, and competitive advantages that result from the ownership of long- lived assets that do not possess physical substance. The allocation of the cost of an intangible asset to expense in a rational and systematic manner. Aright to sell certain products or services, or use certain trademarks or trade names within a designated geographic area. Costs incurred by a company that often lead to patents or new products....
Question text
Preparing the
[I] consolidation journal entries for sale of depreciable
assets - Equity method
Assume that on January 1, 2011, a wholly owned subsidiary sells to
its parent, for a sale price of $132,000, equipment that originally
cost $156,000. The subsidiary originally purchased the equipment on
January 1, 2007, and depreciated the equipment assuming a 10-year
useful life (straight-line with no salvage value). The parent has
adopted the subsidiary's depreciation policy and depreciates the
equipment over the remaining...
Chapter 8: Accounting for Long-Term Operational Assets Basket Purchase Allocation, Depreciation, Gain Loss on Sale. Bishop Enterprises purchased land, a building, and some equipment on January 1, 2018 for $400,000. An appraiser valued the land at $50,000, the building at $350,000, and the equipment at $100,000. The building has a useful life of 20 years and the company expects the residual value to be $30,000. The equipment has a useful life of 5 years with an expected residual value of...
Assume that one of the fixed assets listed in Apple’s 2017 balance
sheet will be disposed of. Please provide the journal entry for the
disposition of that asset. (You may have to look in the notes to
the financial statements to see what the amount of accumulated
depreciation is.) Next, assume that the company will sell the fixed
asset for a gain of $20,000. Please provide the journal entry for
the sale of that asset at a $20,000 gain.
Note...
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