I

1. Ouyang Inc. has recently acquired new equipment and incurred the following costs: Table: Ouyang Equipment Cost Financial Information Costs Purchase Price 3,000 Shipping 200 Installation 890 Testing 270 Maintenance 900 The total cost of the equipment recognized in the balance sheet should be: A) 5,260 B) 4,990 C) 4,370 D) 4,360 E) 3,200 2. Ouyang Inc., which uses IFRS, borrows capital to finance the construction of its plant. The loan has the following information. Load date: 1 Jan, 2013 Loan amount: $100,000 Annual Interest rate: 10% Loan term: 5 years Payment method: annual payment of interest only The construction takes two years, during which time Ouyang Inc. earned $5,000 by temporarily investing the loan proceeds. How much of the interest can be capitalized related to the construction in its balance sheet? A) 5,000 B) 10,000 C) 15,000 D) 20,000 E) 25,000 3. Ouyang Inc. acquired equipment for $100,000 with a 4-year useful life and $20,000 residual value in 2013. The equipment can be used to produce 10,000 units in its whole life and produced 1,000 units during 2013. Which of the following is true regarding the depreciation expense in 2013? A) Depreciation under units-of-production is $12,000 lower than that under straight-line depreciation. B) Depreciation under units-of-production is $12,000 higher than that under straight-line depreciation. C) Depreciation under units-of-production is the same as that under straight-line depreciation. D) Depreciation under units-of-production is $10,000 lower than that under straight-line depreciation. E) Depreciation under units-of-production is $10,000 higher than that under straight-line depreciation. 4. Ouyang Inc. reports the following information about its equipment under IFRS: Table: Ouyang Inc. Equipment Information Financial Information Amount Fair value 10,000,000 Costs to sell 20,000 Value in use 8,000,000 Residual value 40,000 Acquisition cost 14,000,000 Accumulated depreciation 2,500,000 The amount of the impairment loss on Ouyang's income statement related to this equipment is closet to: A) 2,520,000 B) 2,020,000 C) 1,820,000 D) 1,520,000 E) 1,220,000 5. Ouyang Inc. sold a piece of machinery for $350,000 on Dec 31, 2013 and reported the following information related to the machinery with a straight-line depreciation method used. Acquisition cost: $500,000 Acquisition date: 1 Jan, 2013 Residual value: 100,000 Years of useful life: 4 The result of the sale is most likely: A) a loss of $25,000 B) a loss of $50,000 C) a loss of $150,000 D) a gain of $50,000 E) a gain of $250,000 1. Ouyang Inc. has recently acquired new equipment and incurred the following costs: Table: Ouyang Equipment Cost Financial Information Costs Purchase Price 3,000 Shipping 200 Installation 890 Testing 270 Maintenance 900 The total cost of the equipment recognized in the balance sheet should be: A) 5,260 B) 4,990 C) 4,370 D) 4,360 E) 3,200 2. Ouyang Inc., which uses IFRS, borrows capital to finance the construction of its plant. The loan has the following information. Load date: 1 Jan, 2013 Loan amount: $100,000 Annual Interest rate: 10% Loan term: 5 years Payment method: annual payment of interest only The construction takes two years, during which time Ouyang Inc. earned $5,000 by temporarily investing the loan proceeds. How much of the interest can be capitalized related to the construction in its balance sheet? A) 5,000 B) 10,000 C) 15,000 D) 20,000 E) 25,000 3. Ouyang Inc. acquired equipment for $100,000 with a 4-year useful life and $20,000 residual value in 2013. The equipment can be used to produce 10,000 units in its whole life and produced 1,000 units during 2013. Which of the following is true regarding the depreciation expense in 2013? A) Depreciation under units-of-production is $12,000 lower than that under straight-line depreciation. B) Depreciation under units-of-production is $12,000 higher than that under straight-line depreciation. C) Depreciation under units-of-production is the same as that under straight-line depreciation. D) Depreciation under units-of-production is $10,000 lower than that under straight-line depreciation. E) Depreciation under units-of-production is $10,000 higher than that under straight-line depreciation. 4. Ouyang Inc. reports the following information about its equipment under IFRS: Table: Ouyang Inc. Equipment Information Financial Information Amount Fair value 10,000,000 Costs to sell 20,000 Value in use 8,000,000 Residual value 40,000 Acquisition cost 14,000,000 Accumulated depreciation 2,500,000 The amount of the impairment loss on Ouyang's income statement related to this equipment is closet to: A) 2,520,000 B) 2,020,000 C) 1,820,000 D) 1,520,000 E) 1,220,000 5. Ouyang Inc. sold a piece of machinery for $350,000 on Dec 31, 2013 and reported the following information related to the machinery with a straight-line depreciation method used. Acquisition cost: $500,000 Acquisition date: 1 Jan, 2013 Residual value: 100,000 Years of useful life: 4 The result of the sale is most likely: A) a loss of $25,000 B) a loss of $50,000 C) a loss of $150,000 D) a gain of $50,000 E) a gain of $250,000 1. Ouyang Inc. has recently acquired new equipment and incurred the following costs: Table: Ouyang Equipment Cost Financial Information Costs Purchase Price 3,000 Shipping 200 Installation 890 Testing 270 Maintenance 900 The total cost of the equipment recognized in the balance sheet should be: A) 5,260 B) 4,990 C) 4,370 D) 4,360 E) 3,200 2. Ouyang Inc., which uses IFRS, borrows capital to finance the construction of its plant. The loan has the following information. Load date: 1 Jan, 2013 Loan amount: $100,000 Annual Interest rate: 10% Loan term: 5 years Payment method: annual payment of interest only The construction takes two years, during which time Ouyang Inc. earned $5,000 by temporarily investing the loan proceeds. How much of the interest can be capitalized related to the construction in its balance sheet? A) 5,000 B) 10,000 C) 15,000 D) 20,000 E) 25,000 3. Ouyang Inc. acquired equipment for $100,000 with a 4-year useful life and $20,000 residual value in 2013. The equipment can be used to produce 10,000 units in its whole life and produced 1,000 units during 2013. Which of the following is true regarding the depreciation expense in 2013? A) Depreciation under units-of-production is $12,000 lower than that under straight-line depreciation. B) Depreciation under units-of-production is $12,000 higher than that under straight-line depreciation. C) Depreciation under units-of-production is the same as that under straight-line depreciation. D) Depreciation under units-of-production is $10,000 lower than that under straight-line depreciation. E) Depreciation under units-of-production is $10,000 higher than that under straight-line depreciation. 4. Ouyang Inc. reports the following information about its equipment under IFRS: Table: Ouyang Inc. Equipment Information Financial Information Amount Fair value 10,000,000 Costs to sell 20,000 Value in use 8,000,000 Residual value 40,000 Acquisition cost 14,000,000 Accumulated depreciation 2,500,000 The amount of the impairment loss on Ouyang's income statement related to this equipment is closet to: A) 2,520,000 B) 2,020,000 C) 1,820,000 D) 1,520,000 E) 1,220,000 5. Ouyang Inc. sold a piece of machinery for $350,000 on Dec 31, 2013 and reported the following information related to the machinery with a straight-line depreciation method used. Acquisition cost: $500,000 Acquisition date: 1 Jan, 2013 Residual value: 100,000 Years of useful life: 4 The result of the sale is most likely: A) a loss of $25,000 B) a loss of $50,000 C) a loss of $150,000 D) a gain of $50,000 E) a gain of $250,000 1. Ouyang Inc. has recently acquired new equipment and incurred the following costs: Table: Ouyang Equipment Cost Financial InformationCosts Purchase Price3,000 Shipping200 Installation890 Testing270 Maintenance900 The total cost of the equipment recognized in the balance sheet should be: A) 5,260 B) 4,990 C) 4,370 D) 4,360 E) 3,200 2. Ouyang Inc., which uses IFRS, borrows capital to finance the construction of its plant. The loan has the following information. Load date: 1 Jan, 2013 Loan amount: $100,000 Annual Interest rate: 10% Loan term: 5 years Payment method: annual payment of interest only The construction takes two years, during which time Ouyang Inc. earned $5,000 by temporarily investing the loan proceeds. How much of the interest can be capitalized related to the construction in its balance sheet? A) 5,000 B) 10,000 C) 15,000 D) 20,000 E) 25,000 3. Ouyang Inc. acquired equipment for $100,000 with a 4-year useful life and $20,000 residual value in 2013. The equipment can be used to produce 10,000 units in its whole life and produced 1,000 units during 2013. Which of the following is true regarding the depreciation expense in 2013? A) Depreciation under units-of-production is $12,000 lower than that under straight-line depreciation. B) Depreciation under units-of-production is $12,000 higher than that under straight-line depreciation. C) Depreciation under units-of-production is the same as that under straight-line depreciation. D) Depreciation under units-of-production is $10,000 lower than that under straight-line depreciation. E) Depreciation under units-of-production is $10,000 higher than that under straight-line depreciation. 4. Ouyang Inc. reports the following information about its equipment under IFRS: Table: Ouyang Inc. Equipment Information Financial InformationAmount Fair value10,000,000 Costs to sell20,000 Value in use8,000,000 Residual value40,000 Acquisition cost14,000,000 Accumulated depreciation2,500,000 The amount of the impairment loss on Ouyang's income statement related to this equipment is closet to: A) 2,520,000 B) 2,020,000 C) 1,820,000 D) 1,520,000 E) 1,220,000 5. Ouyang Inc. sold a piece of machinery for $350,000 on Dec 31, 2013 and reported the following information related to the machinery with a straight-line depreciation method used. Acquisition cost: $500,000 Acquisition date: 1 Jan, 2013 Residual value: 100,000 Years of useful life: 4 The result of the sale is most likely: A) a loss of $25,000 B) a loss of $50,000 C) a loss of $150,000 D) a gain of $50,000 E) a gain of $250,000

1. Ouyang Inc. has recently acquired new equipment and incurred the following costs: Table: Ouyang Equipment Cost Financial Information Costs Purchase Price 3,000 Shipping 200 Installation 890 Testing 270 Maintenance 900 The total cost of the equipment recognized in the balance sheet should be: A) 5,260 B) 4,990 C) 4,370 D) 4,360 E) 3,200 2. Ouyang Inc., which uses IFRS, borrows capital to finance the construction of its plant. The loan has the following information. Load date: 1 Jan, 2013 Loan amount: $100,000 Annual Interest rate: 10% Loan term: 5 years Payment method: annual payment of interest only The construction takes two years, during which time Ouyang Inc. earned $5,000 by temporarily investing the loan proceeds. How much of the interest can be capitalized related to the construction in its balance sheet? A) 5,000 B) 10,000 C) 15,000 D) 20,000 E) 25,000 3. Ouyang Inc. acquired equipment for $100,000 with a 4-year useful life and $20,000 residual value in 2013. The equipment can be used to produce 10,000 units in its whole life and produced 1,000 units during 2013. Which of the following is true regarding the depreciation expense in 2013? A) Depreciation under units-of-production is $12,000 lower than that under straight-line depreciation. B) Depreciation under units-of-production is $12,000 higher than that under straight-line depreciation. C) Depreciation under units-of-production is the same as that under straight-line depreciation. D) Depreciation under units-of-production is $10,000 lower than that under straight-line depreciation. E) Depreciation under units-of-production is $10,000 higher than that under straight-line depreciation. 4. Ouyang Inc. reports the following information about its equipment under IFRS: Table: Ouyang Inc. Equipment Information Financial Information Amount Fair value 10,000,000 Costs to sell 20,000 Value in use 8,000,000 Residual value 40,000 Acquisition cost 14,000,000 Accumulated depreciation 2,500,000 The amount of the impairment loss on Ouyang's income statement related to this equipment is closet to: A) 2,520,000 B) 2,020,000 C) 1,820,000 D) 1,520,000 E) 1,220,000 5. Ouyang Inc. sold a piece of machinery for $350,000 on Dec 31, 2013 and reported the following information related to the machinery with a straight-line depreciation method used. Acquisition cost: $500,000 Acquisition date: 1 Jan, 2013 Residual value: 100,000 Years of useful life: 4 The result of the sale is most likely: A) a loss of $25,000 B) a loss of $50,000 C) a loss of $150,000 D) a gain of $50,000 E) a gain of $250,000 1. Ouyang Inc. has recently acquired new equipment and incurred the following costs: Table: Ouyang Equipment Cost Financial Information Costs Purchase Price 3,000 Shipping 200 Installation 890 Testing 270 Maintenance 900 The total cost of the equipment recognized in the balance sheet should be: A) 5,260 B) 4,990 C) 4,370 D) 4,360 E) 3,200 2. Ouyang Inc., which uses IFRS, borrows capital to finance the construction of its plant. The loan has the following information. Load date: 1 Jan, 2013 Loan amount: $100,000 Annual Interest rate: 10% Loan term: 5 years Payment method: annual payment of interest only The construction takes two years, during which time Ouyang Inc. earned $5,000 by temporarily investing the loan proceeds. How much of the interest can be capitalized related to the construction in its balance sheet? A) 5,000 B) 10,000 C) 15,000 D) 20,000 E) 25,000 3. Ouyang Inc. acquired equipment for $100,000 with a 4-year useful life and $20,000 residual value in 2013. The equipment can be used to produce 10,000 units in its whole life and produced 1,000 units during 2013. Which of the following is true regarding the depreciation expense in 2013? A) Depreciation under units-of-production is $12,000 lower than that under straight-line depreciation. B) Depreciation under units-of-production is $12,000 higher than that under straight-line depreciation. C) Depreciation under units-of-production is the same as that under straight-line depreciation. D) Depreciation under units-of-production is $10,000 lower than that under straight-line depreciation. E) Depreciation under units-of-production is $10,000 higher than that under straight-line depreciation. 4. Ouyang Inc. reports the following information about its equipment under IFRS: Table: Ouyang Inc. Equipment Information Financial Information Amount Fair value 10,000,000 Costs to sell 20,000 Value in use 8,000,000 Residual value 40,000 Acquisition cost 14,000,000 Accumulated depreciation 2,500,000 The amount of the impairment loss on Ouyang's income statement related to this equipment is closet to: A) 2,520,000 B) 2,020,000 C) 1,820,000 D) 1,520,000 E) 1,220,000 5. Ouyang Inc. sold a piece of machinery for $350,000 on Dec 31, 2013 and reported the following information related to the machinery with a straight-line depreciation method used. Acquisition cost: $500,000 Acquisition date: 1 Jan, 2013 Residual value: 100,000 Years of useful life: 4 The result of the sale is most likely: A) a loss of $25,000 B) a loss of $50,000 C) a loss of $150,000 D) a gain of $50,000 E) a gain of $250,000 1. Ouyang Inc. has recently acquired new equipment and incurred the following costs: Table: Ouyang Equipment Cost Financial Information Costs Purchase Price 3,000 Shipping 200 Installation 890 Testing 270 Maintenance 900 The total cost of the equipment recognized in the balance sheet should be: A) 5,260 B) 4,990 C) 4,370 D) 4,360 E) 3,200 2. Ouyang Inc., which uses IFRS, borrows capital to finance the construction of its plant. The loan has the following information. Load date: 1 Jan, 2013 Loan amount: $100,000 Annual Interest rate: 10% Loan term: 5 years Payment method: annual payment of interest only The construction takes two years, during which time Ouyang Inc. earned $5,000 by temporarily investing the loan proceeds. How much of the interest can be capitalized related to the construction in its balance sheet? A) 5,000 B) 10,000 C) 15,000 D) 20,000 E) 25,000 3. Ouyang Inc. acquired equipment for $100,000 with a 4-year useful life and $20,000 residual value in 2013. The equipment can be used to produce 10,000 units in its whole life and produced 1,000 units during 2013. Which of the following is true regarding the depreciation expense in 2013? A) Depreciation under units-of-production is $12,000 lower than that under straight-line depreciation. B) Depreciation under units-of-production is $12,000 higher than that under straight-line depreciation. C) Depreciation under units-of-production is the same as that under straight-line depreciation. D) Depreciation under units-of-production is $10,000 lower than that under straight-line depreciation. E) Depreciation under units-of-production is $10,000 higher than that under straight-line depreciation. 4. Ouyang Inc. reports the following information about its equipment under IFRS: Table: Ouyang Inc. Equipment Information Financial Information Amount Fair value 10,000,000 Costs to sell 20,000 Value in use 8,000,000 Residual value 40,000 Acquisition cost 14,000,000 Accumulated depreciation 2,500,000 The amount of the impairment loss on Ouyang's income statement related to this equipment is closet to: A) 2,520,000 B) 2,020,000 C) 1,820,000 D) 1,520,000 E) 1,220,000 5. Ouyang Inc. sold a piece of machinery for $350,000 on Dec 31, 2013 and reported the following information related to the machinery with a straight-line depreciation method used. Acquisition cost: $500,000 Acquisition date: 1 Jan, 2013 Residual value: 100,000 Years of useful life: 4 The result of the sale is most likely: A) a loss of $25,000 B) a loss of $50,000 C) a loss of $150,000 D) a gain of $50,000 E) a gain of $250,000 1. Ouyang Inc. has recently acquired new equipment and incurred the following costs: Table: Ouyang Equipment Cost Financial Information Costs Purchase Price 3,000 Shipping 200 Installation 890 Testing 270 Maintenance 900 The total cost of the equipment recognized in the balance sheet should be: A) 5,260 B) 4,990 C) 4,370 D) 4,360 E) 3,200 2. Ouyang Inc., which uses IFRS, borrows capital to finance the construction of its plant. The loan has the following information. Load date: 1 Jan, 2013 Loan amount: $100,000 Annual Interest rate: 10% Loan term: 5 years Payment method: annual payment of interest only The construction takes two years, during which time Ouyang Inc. earned $5,000 by temporarily investing the loan proceeds. How much of the interest can be capitalized related to the construction in its balance sheet? A) 5,000 B) 10,000 C) 15,000 D) 20,000 E) 25,000 3. Ouyang Inc. acquired equipment for $100,000 with a 4-year useful life and $20,000 residual value in 2013. The equipment can be used to produce 10,000 units in its whole life and produced 1,000 units during 2013. Which of the following is true regarding the depreciation expense in 2013? A) Depreciation under units-of-production is $12,000 lower than that under straight-line depreciation. B) Depreciation under units-of-production is $12,000 higher than that under straight-line depreciation. C) Depreciation under units-of-production is the same as that under straight-line depreciation. D) Depreciation under units-of-production is $10,000 lower than that under straight-line depreciation. E) Depreciation under units-of-production is $10,000 higher than that under straight-line depreciation. 4. Ouyang Inc. reports the following information about its equipment under IFRS: Table: Ouyang Inc. Equipment Information Financial Information Amount Fair value 10,000,000 Costs to sell 20,000 Value in use 8,000,000 Residual value 40,000 Acquisition cost 14,000,000 Accumulated depreciation 2,500,000 The amount of the impairment loss on Ouyang's income statement related to this equipment is closet to: A) 2,520,000 B) 2,020,000 C) 1,820,000 D) 1,520,000 E) 1,220,000 5. Ouyang Inc. sold a piece of machinery for $350,000 on Dec 31, 2013 and reported the following information related to the machinery with a straight-line depreciation method used. Acquisition cost: $500,000 Acquisition date: 1 Jan, 2013 Residual value: 100,000 Years of useful life: 4 The result of the sale is most likely: A) a loss of $25,000 B) a loss of $50,000 C) a loss of $150,000 D) a gain of $50,000 E) a gain of $250,000