$1.$a Which of the following is an accelerated depreciation method?

a$)$ sum$-$of$-$the years'$-$digits method

b$)$ double declining balance method

c$)$ activity$-$based method

d$)$ Both $($a$)$ and $($b$)$ are correct.

e$)$ Both $($a$)$ and $($c$)$ are correct.

$1.$b A machine was purchased for $$30,000.$ Freight costs are $$900,$ and installation costs are $$1,400.$ Wages for the new equipment operators will be $$3,000$ per month. The cost of the equipment is:

a$)30,000$

b$)30,900$

c$)32,300$

d$)35,300$

e$)31,400$

$1.$c If $25\%$ of the common stock of an investee company is purchased as a long$-$term investment, the appropriate method of accounting for the investment is:

a$)$ the cost method.

b$)$ the equity method.

c$)$ the preparation of consolidated financial statements.

d$)$ determined by agreement with whomever owns the remaining $75\%$ of the stock.

e$)$ the unrealized holding gain method.

$1.$d Under the equity method of accounting for investments in common stock, when a dividend is received from the investee company:

a$)$ the Dividend Revenue account is credited.

b$)$ the Investments account is increased.

c$)$ no entry is necessary.

d$)$ the Dividend Revenue account is debited.

e$)$ the Investments account is decreased.

$1.$e Financial statements must be consolidated if:

a$)$ a company uses the equity method of accounting.

b$)$ a company owns more than $20\%$ of another company.

c$)$ a company owns more than $50\%$ of another company.

d$)$ mark to market accounting is used.

e$)$ a company has long$-$term investments.