The term used to describe the amount the company expects to receive for an asset at the end of its service life is ____________. Historical cost.residual value.lower of cost or market value.impairment value. The depreciation method that allocates an equal amount of the depreciable base to each year of the asset’s service life is theMultiple choice question.MACRSdouble-declining-balance method.straight-line method.units-of-output method. An amount spent is considered a current expense, or an amount charged in the current period, if the amount incurred did not help to extend the life of or improve the asset. Therefore, this maintenance would be expensed within the current period.
2 Analyze and Classify Capitalized Costs versus Expenses
The selling price of an asset.an allocation of a cost of an asset.a decline in value of an asset. Multiple choice question.Gross profit divided by sales.Net income divided by average total assets.Net income divided by average shareholders’ equity.Net income divided by net sales. The original cost of an asset minus accumulated depreciation isdisposal value.book value.goodwill.residual value.
Unit 11: Plant Assets and Intangible Assets
- Overall, in determining a company’s financial performance, we would not expect that Liam should have an expense of $5,000 this year and $0 in expenses for this machine for future years in which it is being used.
- The formula for calculating declining balance depreciation is the depreciation rate per year times _____________.
- The formula for calculating declining balance depreciation is the depreciation rate per year times ___________.
- Asset turnover ratio is net sales divided by ___________.average total assets.average accounts receivable.average noncurrent assets.average current assets.
For example, an individual who wishes to open a hamburger restaurant may purchase a McDonald’s franchise; the two parties involved are the individual business owner and McDonald’s Corporation. This franchise would allow the business cost allocation of an intangible asset is referred to as owner to use the McDonald’s name and golden arch, and would provide the owner with advertising and many other benefits. A long-lived asset is assumed to be impaired if its estimated future cash flows are _________ than its book value. Straight-line, declining-balance, and activity-based refer to methods commonly used to __________ property, plant, and equipment. The original cost of an asset minus accumulated depreciation isMultiple choice question.disposal value.goodwill.residual value.book value.
PREP U CHAPTER 16 END OF LIFE
- Protection for the patent owner begins at the time of patent application and lasts for 17 years from the date the patent is granted.
- The purchase price and all costs to bring an asset to its desired condition and location for use should be ______.
- If a long-term asset is used in the business operations, it will belong in property, plant, and equipment or intangible assets.
- Most publications have a limited (finite) life; a creator may amortize the cost of the copyright to expense on a straight-line basis or based upon the pattern in which the economic benefits are used up or consumed.
- The formula for straight-line depreciation isMultiple choice question.(cost + residual value)/service life.cost/service life.service life/(cost + residual value).(cost – residual value)/service life.
- In addition to providing benefits, a franchise usually places certain restrictions on the franchisee.
Such a lawsuit establishes the validity of the patent and thereby increases its service potential. In addition, the firm debits the cost of any competing patents purchased to ensure the revenue-generating capability retained earnings of its own patent to the Patents account. In a basket or lump-sum purchase of assets, the total acquisition cost is allocated to the individual assets by multiplying the lump-sum purchase price timesthe relative book value percentages of each asset.the relative fair value percentages of each asset. Straight-line deprecation is calculated as the depreciable cost divided by __________.
Financial Accounting
Book value at beginning of year x 2/estimated service lifehistorical cost less residual value x 2/estimated service life.book value at beginning law firm chart of accounts of the year less residual value x 2/ estimated service life.historical cost x 1/service life. Which of the following does not differ among the different depreciation methods? Multiple choice question.Depreciation recognized during the earlier years.Depreciation recognized during the last year of the asset’s service life.Total depreciation recognized over the asset’s service life.
- It allocates an equal amount of depreciation to each year the asset is used.d.
- Current asset.intangible asset.finite asset.depreciable asset.
- Firms may include only outright purchase costs in the acquisition cost of an intangible asset; the acquisition cost does not include cost of internal development or self-creation of the asset.
- The finite useful life for a copyright extends to the life of the creator plus 50 years.
When a business purchases a long-term asset (used for more than one year), it classifies the asset based on whether the asset is used in the business’s operations. If a long-term asset is used in the business operations, it will belong in property, plant, and equipment or intangible assets. Capitalization is the process by which a long-term asset is recorded on the balance sheet and its allocated costs are expensed on the income statement over the asset’s economic life.
Science Periodic Table Vocabulary
The term used to describe the amount the company expects to receive for an asset at the end of its service life isMultiple choice question.historical cost.residual value.impairment value.lower of cost or market value. In accounting, the term impairment refers toMultiple choice question.allocation of an asset over its service life.an asset’s significant decline in value.offsetting liabilities against the related assets.cost recovery of an asset for investment purposes. Goodwill may only be recognizedMultiple choice question.when assets are impaired.when intangible assets are undervalued.when a company pays less than fair value for an intangible.in a business acquisition. Only intangible assets that are purchased are recorded by a business.