acc101 3

QN=297 A company purchased new computers at a cost of $28,000 on January 1, 2010. The computers are estimated to have a useful life of 5 years and have a salvage value of 3,000. The company uses the straight-line method of depreciation. How much depreciation expense will be recorded for the computers for the year ended December 31, 2010?

• a. $5,000

• b. $6,000

• c. $3,000

• d. $5,600

• e. $6,500

QN=298 Depreciation is:

• a. The assigning or allocating of a fixed asset's cost to expense over the accounting periods that the asset is likely to be used

• b. The assigning or allocating of a tangible asset's cost to expense over the accounting periods that the asset is likely to be used.

• c. The assigning or allocating of a intangible asset's cost to expense over the accounting periods that the asset is likely to be used

• d. The assigning or allocating of a fixed asset's cost to expense over the accounting periods

• e. None of these

QN=299 A vehicle had an estimated useful life of 8 years. The vehicle cost $23,000 and its estimated salvage value is $1,500. The depreciation expense (using straight line method) for a year is:

• a. $ 2687.50

• b. $ 3546.50

• c. $ 2875.00

• d. $10,750.00.

• e. $ 2,856.25.

QN=303 Thomas Enterprises purchased a depreciable asset on January 1, 2008 at a cost of $100,000 and use straight-line method to estimate depreciation expense.The asset is expected to have a salvage value of $15,000 at the end of its five-year useful life. Balance of accumulated depreciation of this asset at the end of 2009 is

• a. $27540

• b. $21600

• c. $34000

• d. $17000

• e. $90000

QN= 304 A new photocopy machinery was purchased for $110,000. To put this machine in a readily usable condition, it cost the company additionally $500 for freight, $2,000 for assembling and testing. What is the cost of the machinery to be recorded in accounting book?

• a. $110,000

• b. $110,500

• c. $112,000

• d. $112,500

• e. $108,000

QN=305 An estimate of an asset's value at the end of its benefit period is called:

• a. Asset at cost

• b. Book value

• c. Salvage value

• d. Depreciation expense

• e. Expense

QN=306 Which of the following assets is not depreciated?

• a. Vehicle

• b. Machine

• c. Inventory

• d. Buildings

• e. All of these are depreciated

QN=307 Which statement is true?

• a. Assets need to depreciate include vehicle, machine, supplies, buildings

• b. Assets need to depreciate include van, machine, supplies, buildings

• c. Assets need to depreciate include machine, supplies, buildings

• d. Assets need to depreciate include vehicle, machine, buildings

• e. Assets need to depreciate include vehicle, supplies, buildings

QN=308 Which statement is true:

• a. Depreciation Expense is shown on the income statement in order to achieve accounting's matching principle.

• b. Depreciation Expense is shown on the balance sheet in order to achieve accounting's matching principle.

• .c. Depreciation Expense is shown on the income statement

• d. Depreciation Expense is shown on the balance sheet

• e. None of these

QN=309 Which statement is true?

• a. Total asset cost plus accumulated depreciation equals book value.

• b. Total asset cost minus accumulated depreciation equals book value.

• c. Total asset plus depreciation expense equals book value.

• d. Total asset minus depreciation expense equals book value.

• e. None of these.