Can you answer each question?

1:43 II\" LTE Ci 4 Gmail

1:43 LTE < Gmail 1. The cost of equipment consists of the cash purchase price plus certain related costs such as sales taxes and freight charges. True False 2. Cost to construct a plant includes the contract price, architect's fees, building fees, excavation costs but not interest costs incurred to finance the project. True True False 3. The book value of an asset equals its cost less accumulated depreciation. False 4. Under the declining-balance method of depreciation, an asset may not be depreciated below its estimated salvage value. True False 5. Ordinary repairs are expenditures to increase the operating efficiency, productive capacity, or expected useful life of a plant asset. True False 6. Depletion cost per unit is computed by dividing the total cost of a natural resource by the estimated number of units in the resource. True False 7. Natural resources include standing timber and underground deposits of oil, gas, and minerals. True False 8. The process of allocating the cost of natural resources to expense is called amortization. True 9. True 10. False In calculating depreciation, both plant asset cost and useful life are based on estimates. False A change in the estimated salvage value of a plant asset requires a restatement of prior years' depreciation. True Multiple Choice 1. a. b. c. d. 2. False The cost of a factory machine includes all of the following costs except invoice price less discount taken. sales tax and insurance during shipping. three-year insurance policy on the machine. testing and installation cost. On January 1, a machine with a useful life of 5 years and a salvage value of $8,000 was purchased for $160,000. What is the depreciation expense in year 2 under the double declining-balance method? a. b. c. d. $12,000 a. b. c. d. a. b. c. d. to as a. b. c. d. $38,400 $36,480 $25,600 $24,320 3. An asset that cost $80,000 and has accumulated depreciation of $60,000 is sold for . The journal entry would include a 4. 5. debit to Loss on Disposal of $20,000. debit to Loss on Disposal of $8,000. credit to Gain on Disposal of $8,000. credit to Accumulated Depreciation for $60,000. The exclusive right to reproduce and sell an artistic or published work is called a patent. trademark. license. copyright. Costs incurred to increase the operating efficiency or useful life of a plant asset are referred capital expenditures. expense expenditures. ordinary repairs. revenue expenditures.