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ACC644_FINAL EXAM REVIEW MOD 6 to 8.docx - Goldey-Beacom...

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Goldey-Beacom CollegeACC644 Financial Reporting and AnalysisFinal Exam ReviewModule 6 to 8 – Key Points to Ponder/UnderstandDepreciation reflects a big “cost” and reflects the “using up” of an asset – PP&E – over someestimated useful life.A variety of methods exist -Straight line; Double declining balance; sumof the years digits; etc.Book and Tax can be different. Why would tax want to acceleratedepreciation costs to earlier in the life of the asset?Are there conventions about when to startdeprecation of an asset?For tax, what is this so called “1/2 year convention?”Among themethods, is it the ENTIRE cost that gets depreciated or is it the cost less an estimated salvagevalue?What IS the capitalized cost of the asset?For example, freight paid to acquire the asset– is it “expensed” immediately or, rather, is it added to the cost of the asset?Where the fairvalue of the asset is somehow deemed to be higher than the amount paid, which amount getsdepreciated?
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Term
Summer
Professor
N/A
Tags
Balance Sheet, Depreciation, Generally Accepted Accounting Principles

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