question chapter 9 - Corrieten Company purchased equipment...

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Corrieten Company purchased equipment and incurred these costs: Cash price $24,000 Sales taxes 1,200 Insurance during transit 200 Installation and testing 400 Total costs $25,800 What amount should be recorded as the cost of the equipment? (a) $24,000. (b) $25,200. (c) $25,400. (d) $25,800. Answer: (d) $25,800. Harrington Corporation recently leased a number of trucks from Andre Corporation. In inspecting the books of Harrington Corporation, you notice that the trucks have not been recorded as assets on its balance sheet. From this you can conclude that Harrington is accounting for this transaction as a/an: (a) operating lease. (b) capital lease. (c) purchase. (d) None of the above. Answer: (a) operating lease. Depreciation is a process of: (a) valuation. (b) cost allocation. (c) cash accumulation. (d) appraisal.
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Answer: (b) cost allocation. Cuso Company purchased equipment on January 1, 2009, at a total invoice cost of $400,000. The equipment has an estimated salvage value of $10,000 and an estimated useful life of 5 years. What is the amount of accumulated depreciation at December 31, 2010, if the straight-line
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This note was uploaded on 11/08/2011 for the course ACCOUNTING ac 201 taught by Professor - during the Spring '11 term at Montgomery.

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question chapter 9 - Corrieten Company purchased equipment...

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