ACC Chapter 18 - Chapter 18 - Plant & Equipment 1. A...

Info iconThis preview shows pages 1–4. Sign up to view the full content.

View Full Document Right Arrow Icon
Chapter 18 - Plant & Equipment 1. A company purchased land for $60,000 cash. Real estate brokers' commission was $5,000 and $7,000 was spent for demolishing an old building on the land before construction of a new building could start. The cost of land should be recorded at a. $67,000. b. $60,000. c. $65,000. d. $72,000. 2. Which is not considered a part of the cost of a business truck? a. Sales tax b. Truck tabs c. Delivery charges d. Cost of advertising on the side of the truck 3. Which of these assets does not decline in potential over its useful life? a. Equipment b. Furnishings c. Land d. Fixtures 4. Four categories for plant assets might be a. land, land improvements, buildings, and equipment. b. intangibles, land, buildings, and equipment. c. furnishings and fixtures, land, buildings, and equipment. d. property, plant, equipment, and land. 5. The cost of land does not include a. brokers' commission. b. annual property taxes. c. accrued property taxes assumed by the purchaser. d. title fees. 6. Holman Inc. purchases land for $50,000 cash. The company assumes $1,000 in property taxes. Legal fees totaled $2,000. Holman grades the land for $3,000. What does Holman Inc. record as the cost
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
for the land? a. $50,000. b. $51,000. c. $53,000. d. $56,000. 7. Holman Company buys land for $1,000 in 1976. The land was appraised at $1,000,000. on 1/1/03 and $1,100,000 on 12/31/03. What amount should the Land account be increased? a. $0. b. $1,000,000. c. $1,100,000. d. $1,099,000. 8. Holman Company purchases land for $50,000 cash. Additional costs are as follows: Removal of shed $ 500 Grading 2,500 Salvage value of shed lumber 500 Broker commission 1,000 Paving of parking lot 10,000 Closing costs 2,000 Sutton will record the acquisition cost of the land as a. $53,000. b. $55,500. c. $53,600. d. $55,600. 9. Holman Incl puts in a new parking lot with paving costs of $50,000 and parking lot lights costs of $10,000. a. $40,000 should be debited to the Land account. b. $15,000 should be debited to Land Improvements. c. $55,000 should be debited to the Land account. d. $60,000 should be debited to Land Improvements. 10. Land improvements should be depreciated over the useful life of the a. land.
Background image of page 2
b. buildings on the land. c. land or land improvements whichever is longer. d. land improvements. 11. Newcome's Daycare is building a new campus that will take three years to complete. Some of the costs will be financed by funds borrowed during the construction period. There will also be architect fees, excavation fees, and building permit fees. Which of the following is true? a. Excavation fees are capitalized but not building permit fees.
Background image of page 3

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Image of page 4
This is the end of the preview. Sign up to access the rest of the document.

This note was uploaded on 06/11/2009 for the course ACCOUNTING ACC taught by Professor Moris during the Summer '09 term at Florida College.

Page1 / 18

ACC Chapter 18 - Chapter 18 - Plant & Equipment 1. A...

This preview shows document pages 1 - 4. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online