ACCT101-Handout08

ACCT101-Handout08 - Acct 101 L12 L13 L16 Handout#08...

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Acct 101 L12, L13, L16 Handout #08 1 Long-term Assets ± Tangible assets: Land Property, plant, and equipment Natural resources ± Intangible assets: Good will Patents, copyrights, franchises, licenses, trademarks (see textbook) ± Cost of long-term assets: Acquisition: cash paid or fair market value of the asset that can be clearly determined. Construction: all the necessary costs associated with construction (materials, labor, interests, etc.) Additions and improvements: increase productive life, efficiency, capacity (capital expenditures) Ordinary repairs and maintenance? ± Impairment Net book value > estimated future cash flows Impairment loss = Net book value – Fair value
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Acct 101 L12, L13, L16 Handout #08 2 ± Depreciation methods (use P 8-2, requirement 2 as an example.) Straight-line Unit-of-production Double-declining-balance ± Disposal Update adjusting entry Record disposal with gains/losses
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ACCT101-Handout08 - Acct 101 L12 L13 L16 Handout#08...

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