The transfer to expense of the cost of intangible assets attributed to the passage of time or decline in usefulness is called amortization.

True

False

Which of the following is included in the cost of constructing a building?

a. cost of repairing vandalism damage during construction

b. cost of paving the parking lot

c. cost of removing the demolished building existing on the land when it was purchased

d. insurance costs during construction

On June 8, Smith Technologies issued a $75,000, 6%, 140-day note payable to Johnson Company.What is the due date of the note?

a.October 28

b.October 26

c.October 25

d.October 27

Costs associated with normal research and development activities should be treated as intangible assets.

True

False

Assuming no employees are subject to ceilings for their earnings, Harris Company has the following information for the pay period of January 15-31.

Gross payroll$10,000

Federal income tax withheld$1,800

Social security rate6%

Federal unemployment tax rate0.8%

Medicare rate1.5%

State unemployment tax rate5.4%

Salaries Payable would be recorded in the amount of

a. $7,450

b. $8,200

c. $6,830

d. $8,630

On June 8, Williams Company issued an $80,000, 5%, 120-day note payable to BrownIndustries.Assuminga 360-day year, what is the maturity value of the note?

a. $81,333

b. $84,000

c. $88,200

d. $82,600

An estimate of the amount for which an asset can be sold at the end of its useful life is called residual value.

True

False

Long-lived assets that are intangible in nature, used in the operations of the business, andnotheld for sale in the ordinary course of business are called fixed assets.

True

False

Capital expenditures are costs of acquiring, constructing, adding, or replacing property, plant and equipment.

True

False

The name, term, or symbol used to identify a business and its products is called

a. a copyright

b. a patent

c. goodwill

d. a trademark

Payroll taxes are based on the employee's net pay.

True

False

An employee receives an hourly rate of $15, with time and a half for all hours worked in excess of 40 during the week. Payroll data for the current week are as follows: hours worked, 46; federal income tax withheld, $110; cumulative earnings for the year prior to this week, $24,500; Social security tax rate, 6%; and Medicare tax rate, 1.5%; state unemployment compensation tax, 3.4% on the first $7,000; federal unemployment compensation tax, 0.8% on the first $7,000. What is the net amount to be paid to the employee?

a. $544.88

b. $539.00

c. $625.00

d. $569.87