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PracticeFinalExam_30A_noSolutions.pdf

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True False (circle one) If false, explain below or correct above: 7. All plant assets (fixed assets) must be depreciated for accounting purposes. True False (circle one) If false, explain below or correct above: 8. The declining-balance method of depreciation is called an accelerated depreciation method because it depreciates an asset in a shorter period of time than the asset's useful life. True False (circle one) If false, explain below or correct above: 9. A stock split results in the reduction of the par or stated value per share and a proportionate increase in the number of shares outstanding. True False (circle one) If false, explain below or correct above: 10. A $20,000, 8%, 9-month note payable requires an interest payment of $1,200 at maturity. True False (circle one) If false, explain below or correct above:
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30A-Principles of Accounting Fall 2018 Practice Final Exam 4 Section II Multiple Choice Circle the only one correct answer. (3 points each) 11. An asset was purchased for $140,000. It had an estimated salvage value of $35,000 and an estimated useful life of 10 years. After 5 years of use, the estimated salvage value is revised to $28,000 but the estimated useful life is unchanged. Assuming straight-line depreciation, depreciation expense in Year 6 would be? A. $21,000. B. $14,875. C. $11,900. D. $17,500. 12. On August 1, Red Company purchased computer equipment for $10,000 cash and also gave 100 shares of White common stock held by Red Company as an investment. The White common stock cost Red Company $5,000 and on August 1 had a market value of $4,200. Installation costs were $700 and shipping costs were $500. What amount should be the total amount debited to the computer equipment account? 13. At December 31, 2017 Howell Company’s inventory records indicated a balance of $878,000. Upon further investigation it was determined that this amount included the following: $168,000 in inventory purchases made by Howell shipped from the seller 12/27/17 terms FOB destination, but not due to be received until January 2nd $111,000 in goods sold by Howell with terms FOB destination on December 27 th . The goods are not expected to reach their destination until January 6 th . $9,000 of goods received on consignment from Westwood Company What is Howell’s correct ending inventory balance at December 31, 2017?
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