10 Interactive Quiz A

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Interactive Quiz A http://highered.mcgraw-hill.com/sites/0072996536/student_view0/chapter10/interactive_quiz_a.html[6/22/2010 6:48:58 PM] Interactive Quiz A (See related pages) Results Reporter Out of 26 questions, you answered 4 correctly with a final grade of 15% 4 correct (15%) 22 incorrect (85%) 0 unanswered (0%) Your Results: The correct answer for each question is indicated by a . 1 INCORRECT What is the relationship between leaseholds and leasehold improvements? A) Both of them are tangible assets. B) Both of them may be depreciated. C) Leasehold improvements are amortized but leaseholds are depreciated. D) Leasehold improvements are tangible in nature but leaseholds are intangible in nature. E) None of the above statements accurately describe the relationship between leaseholds and leasehold improvements. Feedback: Leaseholds are the intangible rights to occupy property that are conveyed within the lease while leasehold improvements are tangible changes which the lessee makes to the leased property which, due to their permanent attachment to the leased property, must remain with the property when the tenant vacates the premises. 2 INCORRECT Which of the following terms is not a synonym for the term "plant assets"? A) Property, plant, and equipment B) Plant and equipment C) Fixed assets D) Office supplies E) All of the above are synonyms for the term "plant assets" Feedback: Office supplies are considered a current asset and would not be a synonym for plant assets. 3 INCORRECT A large newspaper publisher decides to buy a large printing press. This press is so large that it will occupy one-half of a city block when it is fully assembled. The company pays $1,000,000 for the press, $20,000 to have it trucked to its permanent location, and $30,000 to have it assembled and test run. All three of these dollar amounts are debited to the Machinery account. As it applies to any fixed asset, this procedure is an application of which of the following principles? A) Monetary unit principle B) Going-concern principle C) Entity principle D) Cost principle E) Full-disclosure principle Feedback: When any asset is acquired the amount that is initially debited to the asset account is the sum of all of the costs of acquiring the asset, transporting it to its intended place of use, assembling and test running it if necessary, and placing it into daily operations. This procedure is an application of the cost principle. 4 INCORRECT Which of the following costs incurred on behalf of a piece of newly-purchased land is not debited to the Land account? A) Property taxes in arrears that had to be paid to get clear title to the land B) Real estate commissions paid as part of the purchase transaction C) Real estate transfer taxes paid to the county in which the land is located D) The cost of erecting a chain-link fence on the property's perimeter. E)
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This note was uploaded on 08/01/2010 for the course ACC 101 taught by Professor Layvand during the Spring '09 term at Thomas Edison State.

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10 Interactive Quiz A - Interactive Quiz A Home > Chapter...

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