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The depreciation method that charges more expense in earlier years...

The depreciation method that charges more expense in earlier years than in later years is the __________

  A. straight-line method
  B. double declining-balance method
  C. units-of-production method
  D. all of the above


Question 5 of 20 5.0 Points
The credit portion of the adjustment for the depletion of a coal mine was credited to the Coal Mine account. This error would cause __________.
  A. the period’s net income to be overstated
  B. the period’s net income to be understated
  C. the period end assets to be overstated
  D. none of the above



Question 6 of 20 5.0 Points

A company purchased new machinery and incurred freight, assembly, and installation costs in addition to the invoice cost of the machinery. These additional costs should be debited to __________.

  A. cash
  B. machinery
  C. installation expense
  D. machinery expense




The entry to record the cost of a property, plant, or equipment asset would include __________.

  A. acquisition cost
  B. freight
  C. installation
  D. all of the above


A coal mine was acquired for $2,000,000. No salvage value was expected, and the company expects to mine 2,000,000 tons of coal. During the first year, it mines and sells 220,000 tons of coal. The depletion expense is __________.
  A. $2,220,000
  B. $2,000,000
  C. $220,000
  D. $24,200



Intellectual property assets are __________.
  A. depreciated
  B. depleted
  C. amortized
  D. expensed



The process of writing off an intangible asset is __________.
  A. depreciation
  B. depletion
  C. amortization
  D. none of the above

The cost of equipment is expensed __________.

  A. at the time it is paid
  B. over the periods that benefit the company
  C. in the period it is purchased
  D. in the period it is sold


A tractor costing $80,000 is depreciated using MACRS. The tractor qualifies as a three-year property and has a scrap value of $20,000. The depreciation rates are:


Year 1: 33.33%
Year 2: 44.45%
Year 3: 14.81%
Year 4: 7.41%


What is the depreciation expense for Year 2?

  A. $44,450
  B. $35,560
  C. $26,670
  D. $20,000

Amortization of a patent was ignored. This error would cause __________.

  A. the period’s net income to be overstated
  B. the period’s net income to be understated
  C. the period end assets to be understated
  D. none of the above

Which of the following is a non-depreciable asset?

  A. desk chairs
  B. land
  C. computer
  D. building

A company purchases a patent for $50,000. The patent will be amortized over five years. The entry to record the amortization in the first year is __________.

  A. debit Patents $50,000; credit Cash $50,000
  B. debit Amortization of Patents $10,000; credit Patents $10,000
  C. debit Amortization of Patents $50,000; credit Patents $50,000
  D. debit Patents $10,000; credit Amortization of Patents $10,000

An example of an intangible asset is __________.

  A. a patent
  B. a building
  C. assembly cost
  D. land

All of the following are intangible assets except __________.

  A. patents
  B. copyrights
  C. franchises
  D. Accounts Receivable

According to the MACRS tax rate table, which of the following classes uses straight-line depreciation?

  A. residential rental property
  B. automobiles
  C. railroad tracks
  D. race horses

Using MACRS rates for a three-, five-, seven-, and ten-year property, what is the percentage for the depreciable rate?

  A. 200 percent
  B. 150 percent
  C. 125 percent
  D. 100 percent

The depreciation method that bases the expense on the level of use instead of the passage of time is __________.

  A. units-of-production
  B. straight-line
  C. modified accelerated cost recovery
  D. double-declining-balance










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