Question
The activity method of depreciation Question 5 options: a) is a variable charge approach. b) assumes that depreciation is a function of the passage of
The activity method of depreciation
Question 5 options:
| a) is a variable charge approach. |
| b) assumes that depreciation is a function of the passage of time. |
| c) conceptually associates cost in terms of input measures. |
| d) all of these. |
Question 6 (1 point)
When accounting for asset exchanges, if a transaction lacks commercial substance, which of the following is correct?
Question 6 options:
| Gains can be recognized |
| Gains cannot be recognized |
| The gain will always be $10,000 |
| The cost of the asset received is equal to the net book value plus the gain plus the accumulated depreciation |
Question 7 (1 point)
Albany Inc. incurred the following costs during the year ended December 31, 2014:
Laboratory research aimed at discovery of new knowledge........................ $240,000
Design of new products involving new technology.............................. 87,000
Testing of new products..................................................................... 58,000
Construction of research and development facilities........................... 360,000
Assuming the 6 specific conditions have been demonstrated for development costs, the total amount that is eligible to be capitalized for 2014 is
Question 7 options:
| a) $145,000. |
| b) $240,000. |
| c) $327,000. |
| d) $600,000. |
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