1.Which of the followingis NOTdepreciated under the accounting standards?

Select one:

a.An office building

b.Land

c.Factory equipment

d.A computer

e.A motor vehicle

2.A copyright is obtained for what becomes a very successful book. The publisher expects the book to generate sales for ten years. The copyright should be:

Select one:

a.expensed immediately.

b.amortized over the author's life plus 70 years.

c.amortized over a 20 year period based expected readership.

d.amortized over a reasonable life.

e.amortized over 10 years.

3.An impairment loss occurs when:

Select one:

a.the recoverable amount of an asset exceeds the carrying amount

b.the carrying amount of an asset exceeds the recoverable amount

c.the asset has a zero residual value

d.the recoverable amount of an asset is equal to the carrying amount

e.the recoverable amount of an asset exceeds its initial cost

4.When research and development costs are incurred in the expectation of future benefits, but it is not possible, at the reporting date, to establish that it is probable that future economic benefits will eventuate, then:

Select one:

a.the costs should be recognised as expense together with estimated revenue.

b.there should be an estimation of the future cash flows of the project and this should be recognised as revenue.

c.no action should be taken.

d.the costs should be recognised as an asset.

e.the costs should be recognised as expense prior to recognition of revenues.

5.Jacques Ltd purchased a computer for $6 000 on 1 July 2017. It had an estimated useful life of three years. It was depreciated using the straight-line method. What was the balance of accumulated depreciation at 30 June 2019?

Select one:

a.$3 000

b.None of the other options

c.$2 000

d.$5 000

e.$4 000

6.Which of the following would NOT be debited to the Machinery account?

Select one:

a.Installation costs

b.None of the options.

c.Freight charges to ship the machine to the factory

d.Cost of testing runs of the new machine

e.Electricity used by the machine

7.An appropriate journal entry to recognise an impairment loss under the cost model is:

Select one:

a.DR Accumulated impairment losses XX CR Impairment loss XX

b.DR Loss on revaluation XX CR Machinery XX

c.DR Revenue XX CR Impairment loss XX

d.DR Accumulated impairment losses XX CR Revaluation reserve XX

e.DR Impairment loss XX CR Accumulated impairment losses XX

8.According to the accounting standards, goodwill is recorded as an asset when:

Select one:

a.under no circumstances.

b.when favorable factors combine to create goodwill.

c.when a company has superior earning power.

d.when it is paid for as part of the purchase of a business.

e.only when it is internally generated.

9.On 1 December 2018, Jailbreak Pty Ltd bought a delivery truck for $50,000 cash. At this time, the delivery truck has an expected useful life of 10 years and an expected residual value of $5,000. Jailbreak Pty Ltd uses the cost method to account for the delivery truck, and the depreciation is done on a straight-line basis. On 20 June 2019, Jailbreak Pty Ltd changes the engine of the delivery truck to a more fuel-efficient engine that is also going to extend the useful life of the delivery truck by 5 years. Jailbreak also changes a worn-out tire with a new one. The engine cost Jailbreak Pty Ltd $5,000 and then replacement tire cost Jailbreak Pty Ltd $500, both were paid for in cash. The journal entry on 20 June 2019 would be:

Select one:

a.Dr Delivery Truck$5,000

Dr Maintenance Expense$500

Cr Accounts Payable$5,500

b.Dr Delivery Truck$500

Dr Maintenance Expense$5,000

Cr Accounts Payable$5,500

c.Dr Delivery Truck$5,000

Dr Maintenance Expense$500

Cr Cash$5,500

d.Dr Maintenance Expense$5,500

Cr Cash$5,500

e.Dr Delivery Truck$5,500

Cr Cash$5,500

10.When a company sells machinery at a price equal to its carrying amount, this transaction will be recorded with an entry that would include which of the following?

Select one:

a.Dr Cash XX Dr Accumulated Depreciation XX Cr Machinery XX

b.Dr Cash XX Dr Depreciation Expense XX Cr Accumulated Depreciation XX

c.Dr Machinery XX Cr Cash XX Cr Accumulated Depreciation XX

d.Dr Cash XX Dr Accumulated depreciation XX Cr Gain on sale XX Cr Machinery XX

e.Dr Cash XX Dr Machinery XX Cr Accumulated Depreciation XX