WorksheetsDepreciation and Amortization Quiz
Total questions: 18
Worksheet time: 7mins
Which of the following assets is typically NOT depreciated?
Buildings
Equipment
Land
Vehicles
Which of the following is NOT a common method for calculating depreciation?
Straight-line method
Declining-balance method
First-in, first-out method
Fixed installment method
The Fixed installment method is the other name of which type of depreciation method?
Straight-line method
Written down method
Accelerated
Units-of-production
Amortization is an accounting concept similar to depreciation, but it applies to which type of assets?
Intangible assets, such as patents and copyrights.
Natural resources, such as oil and timber.
Tangible assets, such as machinery and buildings.
Current assets, such as cash and accounts receivable.
Depreciation is to tangible assets as depletion is to:
Intangible assets
Financial assets
Natural resources
Real estate
Which of the following is true regarding the salvage value (scrap value) of an asset?
It must be a positive value.
It is the book value of the asset at the end of its useful life.
It is the estimated market value of the asset at the time of purchase.
It must be higher than the initial cost of the asset.
Which of the following is an example of an intangible asset that would be amortized rather than depreciated?
Office Building
Delivery Truck
Patent
Factory Equipment
Which of the following is a key difference between tangible and intangible assets?
Tangible assets are always more valuable than intangible assets.
Only tangible assets are recorded on a company's balance sheet.
Intangible assets are depreciated, and tangible assets are amortized.
Intangible assets are physically non-existent, while tangible assets have physical substance.
A company develops a new type of software and capitalizes the development costs. The software is expected to be useful for 5 years. This asset would be subject to:
Amortization
Depreciation
Depletion
Impairment only
Which of the following is an example of a Nominal Account?
Cash Account
Building Account
Creditor Account
Rent Expense Account
The golden rule of accounting for Real Accounts is:
Debit the receiver, Credit the giver.
Debit what comes in, Credit what goes out.
Debit all expenses and losses, Credit all incomes and gains.
Debit all assets, Credit all liabilities.
Which accounting principle is the main reason for recording depreciation expense in an accounting period?
Going Concern Principle
Historical Cost Principle
Matching Principle
Consistency Convention
What is the accounting rule that requires consistent methods?
Matching principle
Consistency convention
Historical cost
Going concern
At the end of an asset's useful life, its book value is equal to its:
Historical cost
Salvage value
Accumulated depreciation
Depreciable cost
The straight-line depreciation method results in:
A higher depreciation expense in the early years of an asset's life.
A depreciation expense that is equal to the asset's market value
A lower depreciation expense in the early years of an asset's life.
A constant depreciation expense each year.
How does depreciation affect a company's balance sheet?
It increases total assets.
It decreases total liabilities.
It decreases the book value of an asset.
It increases retained earnings.
What is the primary reason that land is typically not depreciated?
Its value is expected to increase over time.
It is a current asset.
It is not a tangible asset.
It is considered to have an indefinite useful life.
Which of the following would be an example of an asset that is NOT depreciated?
A factory building
A delivery truck
Office furniture
Land
