 |
| 1 | |
Accumulated depreciation is listed on the income statement. |
| | A) | True |
| | B) | False |
|
|
|
| 2 | |
All companies do not depreciate assets. |
| | A) | True |
| | B) | False |
|
|
|
| 3 | |
Depreciation expense is listed on the income statement. |
| | A) | True |
| | B) | False |
|
|
|
| 4 | |
In the units-of-production method, book value never goes below the residual value. |
| | A) | True |
| | B) | False |
|
|
|
| 5 | |
The declining-balance method is not an accelerated depreciation. |
| | A) | True |
| | B) | False |
|
|
|
| 6 | |
MACRS is used for tax purposes. |
| | A) | True |
| | B) | False |
|
|
|
| 7 | |
Straight-line depreciation: |
| | A) | Is used less and less today |
| | B) | Is an accelerated depreciation |
| | C) | Is used by most corporations |
| | D) | Has no residual value |
| | E) | None of the above |
|
|
|
| 8 | |
Book value: |
| | A) | Never changes |
| | B) | Is calculated daily |
| | C) | Is cost plus accumulated depreciation |
| | D) | Is cost less accumulated depreciation |
| | E) | None of the above |
|
|
|
| 9 | |
Depreciation expense in the declining-balance method: |
| | A) | Cannot be depreciated below residual value |
| | B) | Is not used |
| | C) | Is the cost of equipment |
| | D) | Is calculated by book value at beginning of year divided by the rate |
| | E) | None of the above |
|
|
|
| 10 | |
If a car is depreciated in 5 years, the rate of depreciation using twice the straight line rate is: |
| | A) | 20% |
| | B) | 40% |
| | C) | 90% |
| | D) | 100% |
| | E) | None of the above |
|
|
|
| 11 | |
Autos fall into which class recovery period? |
| | A) | Rate divided by cost 3 year |
| | B) | 5 year |
| | C) | 7 year |
| | D) | 10 year |
| | E) | 20 year |
|
|
|
| 12 | |
A truck costs $8,000 with a residual value of $1,000. It has an estimated useful life of 7 years. If the truck was bought on July 9 what would be the book value at the end of year 1? |
| | A) | $7,000 |
| | B) | $7,500 |
| | C) | $5,700 |
| | D) | $1,000 |
| | E) | None of the above |
|
|
|
| 13 | |
A truck costs $9,000 with a residual value of $1,000. The truck is expected to have a useful life of 40,000 miles. By assuming the truck is driven 10,000 miles the first year, the depreciation expense would be: |
| | A) | $2,500 |
| | B) | $250 |
| | C) | $200 |
| | D) | $2,000 |
| | E) | None of the above |
|
|
|
| 14 | |
A truck costs $15,000 with a residual value of $5,000. It is estimated the useful life of the truck is 5 years. The amount of depreciation expense in year 2 by using the declining-balance method at twice the straight-line rate is: |
| | A) | $6,000 |
| | B) | $3,600 |
| | C) | $9,600 |
| | D) | d) $6,900 |
| | E) | None of the above |
|
|
|
| 15 | |
The cost of a van is $16,000 with a residual value of $2,000. The van has an estimated useful life of 5 years. The amount of depreciation expense using straight-line each year is: |
| | A) | $933 |
| | B) | $373 |
| | C) | $737 |
| | D) | $399 |
| | E) | None of the above |
|
|
.