1. When determining anasset's cost, GAAP requires the use of whichprinciple?

A.materiality principle

B.matching principle

C.conservative principle

D.cost principle

2.Other thanland, longterm assets that are capitalizedare:

A.recorded at net realizable value.

B.recorded at market value.

C.expensed in the year of purchase.

D.depreciated over the life of the asset.

3.What does the book value of an assetreflect?

A.The amount of theasset's cost thathasn't been expensed.

B.The net realizable value of the asset.

C.The historical cost of theasset, plus improvements.

D.The amount it would cost to replace the asset.

4.When an asset is disposedof, the currentperiod's depreciation expense account must be updated to the time of the disposal. True/False

5.A piece of equipment that was originally purchased for$25,000, had accumulated depreciation of$18,000, and was sold for$8,000, would recognize a gain of$1,000.

True /False