Question
Quiz Question 1 (1 point) Appa Apparel Corporation purchases another clothing manufacturer for $3,500,000 cash. Appa acquires all of the other company's identifiable assets ($4,000,000)
Quiz
Question 1 (1 point)
Appa Apparel Corporation purchases another clothing manufacturer for $3,500,000 cash. Appa acquires all of the other company's identifiable assets ($4,000,000) and liabilities ($2,000,000). The journal entry to record this acquisition will include a debit to Goodwill of:
Question 1 options:
$1,500,000 | |
$2,500,000 | |
$5,500,000 | |
$3,500,000 |
Question 2 (1 point)
Berger Consulting purchases office equipment for $20,000 on 1/1/20. Berger estimates that the equipment will have a useful life of 4 years and a residual value of $2,000 and calculates depreciation expense using the straight-line method. On 1/1/23 (i.e., after three years), Berger sells the office equipment for $5,000. The journal entry to record this disposal will include a:
Question 2 options:
Loss on Sale of PP&E of $3,000 | |
Gain on Sale of PP&E of $3,000 | |
Gain on Sale of PP&E of $1,500 | |
Loss on Sale of PP&E of $1,500 |
Question 3 (1 point)
Straight Line depreciation and Double-Declining-Balance depreciation always result in the same Depreciation Expense in the final year of the asset's useful life.
Question 3 options:
True | |
False |
Question 4 (1 point)
If Bader Bank Corp purchases a new computer system and pays the following related to the purchase: $2,000,000 for the system itself, $100,000 in sales taxes and $300,000 in installation fees. How much is capitalized into the PP&E account related to the purchase?
Question 4 options:
$2,000,000 | |
$2,100,000 | |
$2,300,000 | |
$2,400,000 |
Question 5 (1 point)
Andrews Surgery Center purchases medical equipment for $200,000 on 1/1/20. Andrews initially estimates that the equipment will have a useful life of 5 years and a residual value of $20,000 and calculates depreciation expense using the straight-line method. On 1/1/22 (i.e., after two years), Andrews revises its estimate; the new total useful life is 4 years and the new residual value is $28,000. Andrews will record _____ in Depreciation Expense in 2023.
Question 5 options:
$40,000 | |
$50,000 | |
$43,000 | |
$36,000 |
Question 6 (1 point)
If a company uses Double-Declining-Balance to calculate depreciation for tax purposes, they must also use Double-Declining-Balance to calculate depreciation for their financial statements.
Question 6 options:
True | |
False |
Question 7 (1 point)
Goodwill is amortized straight-line over a useful life of 10 years.
Question 7 options:
True | |
False |
Question 8 (1 point)
Research and development costs are always capitalized when they are incurred.
Question 8 options:
True | |
False |
Question 9 (1 point)
Straight-Line depreciation and Double-Declining-Balance depreciation result in the same Accumulated Depreciation at the end of the asset's useful life.
Question 9 options:
True | |
False |
Question 10 (1 point)
If a company makes a journal entry to record a PP&E Impairment, the entry will cause:
Question 10 options:
Total Assets to Decrease | |
Net Income to Increase | |
Total Assets to Increase | |
Total Liabilities to Increase |
Question 11 (1 point)
We depreciate Land unless it contains natural resources.
Question 11 options:
True | |
False |
Question 12 (1 point)
Murphy Glass purchases manufacturing equipment for $150,000 on 1/1/20. They estimate that the equipment has a useful life of 10 years and a $10,000 residual value. Accumulated Depreciation will be $_______ as of 12/31/22 (i.e., after three years), and 2022 Depreciation Expense will be $_______.
Question 12 options:
12/31/22 Accumulated Depreciation = $42,000; 2022 Depreciation Expense = $14,000 | |
12/31/22 Accumulated Depreciation = $14,000; 2022 Depreciation Expense = $14,000 | |
12/31/22 Accumulated Depreciation = $42,000; 2022 Depreciation Expense = $42,000 | |
12/31/22 Accumulated Depreciation = $14,000; 2022 Depreciation Expense = $42,000 |
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