Property & Equipment Accounting

The term property and equipment refers to long-lived assets which are acquired for use in the operation of a business and are not intended for resale to customers in the normal course of business. ​

• True

• False

Which of the following is NOT classified as a Property or Equipment?

• Land

• Furniture

• Kitchen Equipment

• Inventory

Which of the following is an intangible long-lived asset?

• Leasehold

• Inventory

• Buildings

• Land

Acquisition cost includes all expenditures necessary to acquire, install, and prepare an item for use. ​

• True

• False

Which of the following is NOT an acquisition cost?

• Annual Insurance Cost

• Freight Cost

• Brokerage Fee

• Installation Charges

Which of the following is a Non-depreciable asset?

• Furniture

• Land

• Equipment

• Machinery

Special electrical wiring to make an item ready for use is considered part of the acquisition cost.

• True

• False

Improvement on land owned is seen as revenue expenditure.

• True

• False

Improvements are sometimes called 'betterments'.

• True

• False

The amount capitalized to a fixed asset account depends on whether the building is owned or leased. 

• True

• False