MULTIPLE CHOICE. Choose the one alternative that best completes the statement or answers the question. 1) Research and development costs should be: A) Deferred pending determination of success. B) Expensed if unsuccessful, capitalized if successful. C) Expensed in the period incurred. D) Expensed in the period they are determined to be unsuccessful. 2) If management can estimate the amount of loss that will occur due to litigation against the company, and the likelihood of the loss is reasonably possible, a contingent liability should be A) Disclosed, but not reported as a linbility. B) Reported as a liability, but not disclosed. C) Neither disclosed nor reported as a liability. D) Disclosed and reported as a liability. 3) A company purchased a commercial dishwasher by paying cash of $8,000. The dishwasher's fair value on the date of the purchase was $10,000. The company incurred $600 in transportation costs, $500 installation fees, and paid $300 annual insurance on the equipment. For what amount will the company record the dishwasher? A) $10,000 B) $8,000. C) $9,400. D) $9,100. 4) A company acquired an office building on three acres of land for a lump-sum price of $2,400,000. The building was completely equipped. According to independent appraisals, the fair values were $1,300,000, S780,000, and $520,000 for the building, land, and equipment, respectively. At what amount would the company record the building? A) $1,300,000 B) $1,200,000 C) $720,000. D) None of these answer choices are correct. 5) Vikings Inc. reports the following amounts: Assets Liabilities Net income Book Value $ 400,000 45,000 25,000 Fair Value $ 500,000 45,000 How much goodwill would be recorded if Torretta Holdings purchases Vikings, assuming its liabilities, for $635,000? A) $100,000. B) $180,000. C) $255,000. D) $280,000 6 Kansas Enterprises purchased equipment for $60,000 on January 1, 2021. The equipment is expected to have a five-year service life, with a residual value of $5,000 at the end of five years. Using the straight-line method, depreciation expense for 2021 would be: A) $12,000. B) $60,000 C) $11,000. D) None of these. 7) Kansas Enterprises purchased equipment for $60,000 on January 1, 2021. The equipment is expected to have a five-year service life, with a residual value of $5,000 at the end of five years. Using the straight-line method, the book value at December 31, 2021, would be: A) $55,000 B) $60,000 C) $44,000. D) $49,000