multiple choice questions to be answered

1) Wisemans Winery purchases land for $200 000 cash. Wisemans Winery assumes $2 500 in rates and taxes due on the land. The title and legal fees totaled $2 750. Wisemans Winery has the land graded for $5 000 and fenced for $20 000. What amount does Wisemans Winery record as the cost for the land? a) $200 000 b) $230 250 c) $210 250 d) $202 750 2) Additions and improvements: a) occur frequently during the ownership of a plant asset. b) should be capitalised and depreciated over the remaining useful life of the related PPE asset. c) normally involve immaterial expenditures. d) typically only benefit the current accounting period. 3) Which of the following describes the assumption underlying the diminishing- balance method of depreciation? a) The asset is equally useful in each year of its life. b) The asset is less useful in the earlier years of its life. c) The asset is more useful in the earlier years of its life. d) None