All post answersmust be labelled with the question numbers.

Discuss the following:

1. Explain why is it important to distinguish between land and land improvements.
2. Explain why it important for the cost of a lump-sum purchase to be allocated to the individual assets acquired.
3. Explain what does the balance in the Accumulated Depreciation"Machinery account represent.
4. What accounting concept justifies charging low-cost plant asset purchases immediately to an expense account? How is the ceiling amount decided for being able to write off the purchase as an expense instead of recording it as an asset?
5. Explain the difference between ordinary repairs and extraordinary repairs and the treatment for each when recorded (JE).
6. Is the declining-balance method an acceptable way to compute depletion of natural resources? Explain.