A company that utilizes the MACRS system of depreciation A will have equal

A company that utilizes the macrs system of

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27. A company that utilizes the MACRS system of depreciation: A. will have equal depreciation costs each year of an asset's life.B.will have a greater tax shield in year two of a project than it would have if the firm had opted for straight-line depreciation, given the same depreciation life.C. can depreciate the cost of land, if it so desires.D. will expense less than the entire cost of an asset.E. cannot expense any of the cost of a new asset during the first year of the asset's life.Refer to section 10.4AACSB: N/ABloom's: KnowledgeDifficulty: BasicLearning Objective: 10-1Section: 10.4Topic: MACRS depreciation10-50
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Chapter 10 - Making Capital Investment Decisions28. Morris Motors just purchased some MACRS 5-year property at a cost of $216,000. Whichone of the following will correctly give you the book value of this equipment at the end of year 2?Refer to section 10.4AACSB: N/ABloom's: KnowledgeDifficulty: BasicLearning Objective: 10-1Section: 10.4Topic: MACRS depreciation10-51
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Chapter 10 - Making Capital Investment Decisions29. Keyser Petroleum just purchased some equipment at a cost of $67,000. What is the proper methodology for computing the depreciation expense for year 2 if the equipment is classified as 5-year property for MACRS?Refer to section 10.4AACSB: N/ABloom's: KnowledgeDifficulty: BasicLearning Objective: 10-1Section: 10.4Topic: MACRS depreciation10-52
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Chapter 10 - Making Capital Investment Decisions30. The current book value of a fixed asset that was purchased two years ago is used in the computation of which one of the following? Refer to section 10.4AACSB: N/ABloom's: ComprehensionDifficulty: BasicLearning Objective: 10-1Section: 10.4Topic: Tax on salvage value10-53
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Chapter 10 - Making Capital Investment Decisions31. The net book value of equipment will: A. remain constant over the life of the equipment.B. vary in response to changes in the market value.C. decrease at a constant rate when MACRS depreciation is used.D. increase over the taxable life of an asset.E.decrease slower under straight-line depreciation than under MACRS.Refer to section 10.4AACSB: N/ABloom's: ComprehensionDifficulty: BasicLearning Objective: 10-1Section: 10.4Topic: Book value
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