10. If Lincoln Company determines that an asset (goodwill) has been impaired by S0.6 million then which of the following will occur at the end of the current accounting period? A) No action will be taken to recognize its impairment until the asset is sold. B) A credit to the goodwill account will be recorded for the amount of the loss. C) A credit to retained earnings will be recorded for the effect of the loss thereby bypassing the income statement. D) The in mpairment will not affect the accounts but will be disclosed in the E) None of the above will occur 11. Hill Inc. purchased an asset on January 1,20x9. Hill chose the accelerated depreciation method to d A) depreciation expense would be greater in 20x9 B) the book value of the asset would be less at the end of 20x9. C) net income would be less in 20x9 D) all of above are correct. E) none of the above is correct. epreciate the asset. Had Hill chosen the SL method tt Company purchased a computer that cost S10,000. It had an estimated useful life of five years and residual value of S0. The computer was depreciated by the straight-line method and was sold at the end of the fourth year of use for $3,000 cash. Abbott should record A) a gain of S1.000. B) a loss of $1,000. C) neither a gain nor a loss the computer was sold at its book value. D) neither a gain nor a loss- the gain that occurred in this case would not be 12. Abbo recognized. E) an extraordinary item. 13. Warren Company plans to depreciate a new building using declining-balance depreciation with 200 percent acceleration rate. The building cost $800,000. The estimated residual value of the building is $50,000 and it has an expected useful life of 25 years. Assuming the first year's depreciation expense was recorded properly, what would be the amount of depreciation expense for the second year? A) S32,000 B) S30,720. C) S58,880. D) S64,000 E) None of the above is correct